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Supreme Court update on single exit price and dispensing fee
2004-12-20

A full bench of the Supreme Court of Appeal this morning ruled in favour of the PSSA and its partners. They unanimously agreed that the pricing regulations should be set aside, and that the Department of Health should pay all legal costs.

The effect of the judgement is that the regulated single exit price and the dispensing fee are no longer in operation. The pharmacist may now charge a fee that will cover the costs of dispensing the medicine. It is important for everyone to note that, although the regulations have been set aside, the Medicines and Related Substances Act still specifies that no person may sell a medicine according to a bonus system, a rebate system or any other incentive scheme, such as discounts. For pharmacists and the consumer, this now creates an environment similar to what was experienced in June, July and August this year.

The Rules relating to Pharmacy Practice, published by the Pharmacy Council on 17 December, reinforce the need for an appropriate dispensing fee. These rules are enforceable and the pharmacist's professional activities will be judged according to the criteria laid down in the 114 page document.

The benefit of the judgement for the consumer is that the separate administration fee charged by pharmacists will no longer be necessary, as this fee will now be incorporated into the price of the medicine as it was in the past. Discussions with medical schemes must now take place, as there are many variables that need to be considered in establishing the price that the schemes are prepared to pay.

The PSSA hopes that manufacturers will voluntarily continue to charge the Single Exit Price, which implements the principle of a transparent pricing system. The PSSA and its members have always supported this.

The challenge for both the PSSA and the Department is to form an effective partnership that will urgently finalise a set of regulations that deals with the principles of a transparent pricing system and an appropriate dispensing fee.

The PSSA calls on pharmacists to continue to be responsible and professional in pricing medicines. (Source: PSSA, 20 December 2004)

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