IT'S THE PEOPLE WHO LOSE: Pharmacists slam unethical practises & PROFITEERING

We refer to your report on Wed, 19th Sept 2012 on the plight of retail pharmacists in Sarawak, and like to share with your readers the realities faced by the retail (also referred to as community) pharmacies.

Dispensing of medicines should be one of the main functions of a pharmacist but in Malaysia community pharmacists had largely been denied this role. In addition to the many restrictions mentioned in your report, community pharmacists have to contend with the various discriminatory practices of drug companies; the most glaring is that community pharmacists, compared to other sectors of the profession and other medical professionals, have to pay more for many of the popular medicines they purchased from most of the drug companies.

Thus because the cost prices of many medicines for the community pharmacists are higher, we are unable to provide these medicines to the public at more affordable prices.

Discrimination

There have been intense discussions in the Facebook and email with regards to how community pharmacies have been discriminated over the years by the drug companies. Perhaps the most revealing can be summarized by what has been read & communicated among pharmacist-members of the Malaysian Pharmaceutical Society:

“…the unfair trade done through discriminatory pricing policy against the community pharmacies, compounded by regular pre-price increase loading and unrealistically huge quantity purchase inducement were being discussed.  This discriminate practice, almost uniquely to Malaysia has given rise to unhealthy commercial activities that threaten the viability of pharmacies and is disruptive to professional pharmacy practice as well.  The promotional practice driven by sales-target-commission has perhaps fostered a “runner-network” driven by greed, made possible by the medical representatives working in cahoot with some members of the healthcare professions themselves.  The artificially inflated price conjures a disorderly retail environment that draws unfair negativity with accusation of price hiking by pharmacies and marring their image and also reflects poorly on ethical practice within the industry.”

The end result of such discriminatory pricing against community pharmacists had resulted in the mushrooming of the illegal “runner” drug distributors.

In addition such discrimination against community pharmacists are infringing the Competition Act and we see these practices still been propagated because of the lack of action from the authorities. The authorities will go to the extent to "test buy" with the intention to gather evidence to book community pharmacies for offences like sale of certain items without a doctor prescription.

Similarly they have no hesitation to demand to see the records and invoices of medicines sales/purchase. Community pharmacies will have to answer if any transactions are not within their "normal quantities". Community pharmacies too had been hauled up if they "share" goods and they are not in possession of valid wholesale licenses.

In addition we see community pharmacists being hauled up to face the pharmacy board over what was considered unethical practices like displaying of promotional materials like banners and leaflets provided by the drug companies. These materials are presumed to have been provided with strict adherence to the requirements of country Drug Registration, Medicine Advertisement and Drug Promotion laws.

The community pharmacies are in no position to regulate or enforce ethical promotional materials or factual claims made in printed materials or lay press except the relevant enforcement authorities. If there is a need to enforce the laws strictly, then it only make sense that all such promotional materials are prohibited against the originators, i.e. the drug companies.

Double standards an open secret

While the authorities are enforcing the laws against the community pharmacies, the same cannot be seen when it comes to the errant appointed distributors and the drug companies.

We already have enough indications and substantiations of unethical promotion and infringements of the Competition Act. All those in the trade are aware of the flow of activities of the illegal runners. This runner network is only made possible by the drug companies’ promotional activities to outlets or practices without wholesale license.

It is an “open secret” but the drug companies shield themselves by calling it a trading issue instead of an infringement against their own Code of Good Conduct!

Runner network and unethical practices

This runner network has given rise to drug being sold at prices of great disparities, leading to professional community pharmacies being wrongly accused of profiteering while the black-sheep among the well-connected community pharmacies and clinics are conducting a brisk business with special offered prices or deals from the drug companies. Almost every “smart” consumer could tell you which community pharmacies are selling “all” medicines “very cheap”.

Many of these runners are ex-workers in the drug industry; know which outlets or practices are getting special deals from which drug companies. Unless there is strict enforcement, what is there to stop some creative minds taking full advantage of the promotional practice driven by sales-target-commission with artificially high price and high free sales goods to the selected group?

Many of these appointed distributors had clearly infringed the Competition Act, either by their discriminatory pricings or by their outright refusal to sell their products to community pharmacies and all these unethical practices are denying the public free access to more affordable and equitably priced medicines.  When enquired, these distributors just indifferently replied that they have no say in those decisions or they are only following the directives of the principal drug companies.

For illustration, both the drug companies and the distributors know that if they sell 10 packs with 10 free packs at total price of RM100 is the same (to them) if they sell 20 packs without the free packs at total price of RM100. However, in the first instance, the recommended selling price to consumers is RM10 for each pack; in the second instance, the recommended selling price is only RM5 for each pack, a saving of 100% to the consumers.

Unfortunately, such high profit from the free packs charged to consumers is only given to selected group of outlets & practices, while community pharmacies are systematically discriminated against. Worst, such discriminatory sales are often done with very high sales values, tens of thousands up to almost or over a hundred thousand in a year. All these sales are recorded in details in the computers of representative offices of the drug companies as well as their own appointed distributors.

Similarly, those pharmacists employed in the drug companies and in the distributors knows very well that goods with holograms and batch numbers traded by the runners could only be originally supplied by their own appointed sole distributors, and such original cheap goods offered by runners are only possible through the special sales deals negotiated by their own sales personnel approved by themselves or their own bosses or subordinates!

The PEOPLE end up being exploited by unprofessional profiteers

Isn’t it common sense what needs to be done urgently is at the sales records of the drug companies and their respective appointed distributors? Going after the already marginalized community pharmacies would not stop these immoral, unethical or illegal trades. Drug prices keep going up, medicines being sold like chocolate bars in pasar malamstyle with lelong sales of 10+5, 20+12, 50+40, or even up to 100+100.

Is patient care substituted by “we guarantee you the cheapest price” the new pharmacy trend? The favored outlets or practices could only make a quick buck by buying “huge” and disposing “it” fast, the runners disperse goods to the pharmacies and clinics; with some of these well-connected outlets gaining reputation by selling all things cheap, probably at 3-6 month’s supplies in order to clear their high inventories, while the care-giving professionals are not left alone without discrimination and harassment to provide the best care to the rakyat, dispensed with equitably priced drugs and compete in open, free & fair environment for the health of the nation on the strength of their respective individual care-giving competence.

Isn’t it easy for your readers to recollect advertisements with headings such as “Must Buy”, “Merdeka Sales”, “Members’ Only”, “Only Three Days Sales”, “Raya Rewards”, “Personal Hygiene Specials”, and “Women’s Health Promotion”, week after week, with no mention of the drug companies’ recommended selling prices (RSP)?

Who is being exploited, the professional practices, the public or both? And which strategy will be more effective to address the issues? Going after the helpless professional practices or putting a stop to unethical promotion at the origin of the source of goods? No other trade trades like drugs and medicines - gone are the gate keepers of rational use of drugs!

“Community Pharmacists”