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Joint Press statement from IEIS, AIFD and TISD

The three organizations, the Pharmaceutical Manufacturers Association of Turkey (IEIS), the Association of Research-Based Pharmaceutical Companies (AIFD) and the Pharmaceutical Industry Association of Turkey (TISD) who are being worked in collaboration with, held a joint press conference within the framework of the latest sector oriented organizations.

In the meeting that took place with the attendance of IEIS General Secretary Turgut Tokgöz, AIFD General Secretary Alp Sevindik and TISD General Secretary Kemalettin Akalın the statement made by Tokgöz on behalf of the three organizations was as follows;
“As you know, in accordance with the changes made in the “Social Security Institution Health Application Communique” on November 5, 2011 the discounts in public pharmaceuticals purchases have been increased and in addition to this the prices of pharmaceuticals have been reduced pursuant to the “Decision Concerning Changes to be Made to the Decision on the Pricing of Human Pharmaceuticals” published on November 10, 2011.

With a third regulation that has been made in addition to the regulations in the last two years a new cost burden has been placed on our sector, which is comprised of pharmaceutical companies, warehouses and pharmacies.

The Euro value which is being applied in the pricing of pharmaceuticals has been fixed at a rate of 1,9595 TL since April of 2009. Whereas the Euro exchange rate is actually moving along at 25% over this rate. Due to the difference between the fixed and up to date Euro rates, our industry has already conveyed the 2.5 billion TL exchange rate difference to the public in the past 2.5 years.

While waiting as a sector for our unjust treatment to be resolved in accordance with the mandatory provision of the decision, we are having difficulty explaining as a sector the enforcement of new regulations. This situation is an indication of the rise in pharmaceuticals prices only being the continuation of futile policies to maintain a balance with price reductions and discounts. Whereas the pharmaceuticals budget determined by the public does not correspond to the quality of services and extensity. The decisions made in the context of reforms that are attempted to be kept going without a sufficient budget have lost their validity.

Today we have invited you here to explain the situation we are in within the context of these new regulations and to share some of our concerns about the future. We thank you all for your participation.

Valued Press Members,

As a result of the reforms within the scope of the Transformation in Health Program, which started in 2004, the access of our people to pharmaceuticals and health services has increased. The quality of health and life has shown a rapid improvement.

When we look at the positive indicators created within the framework of these policies the following are observed;
*  While 84% of the population had social security in 2004 this percentage increased to 96% in 2011.
*  Since 2002 the average lifespan has gone up by 1.9 years and infant deaths have decreased by 52%.
*  The rate at which a number of contagious diseases are seen have significantly decreased.
*  While the number of doctors per person was 1.44 between the year 2002 and 2009 this ration has gone up to 1,65 and the number of beds have increased from 2.46 to 2.71.
*  The number of patient who went to hospital was 124 million in 2002 and reached 295 million in 2009.
*  While the rate of immunizations was 79% in 2000 it reached 96% in 2009.
*  The number of prescriptions being written rise constantly. According to the Social Security Agency data, the number of prescriptions written in 2008 which was 302 million, went up to 357 million with an 18% increase in 2011 as a result of applications that increased access to pharmaceuticals.

As a result of these improvement efforts, the satisfaction in health services in our country which was 40% in 2003 reached 73% in 2010.

Naturally the increase in access to health services and the increase in quality has had a high cost. However, since the very beginning of this transformation process the sector has shown the necessary sensitivity in providing for this cost and has given this process its full support.

During this process, price reductions and discounts started to be used as the basic tools for taking control over the expenditures on pharmaceutical which has increased as a result of the increase in access. As a result the pharmaceuticals prices have gotten to an unforeseeable and unsustainable point which is impossible for our sector to accept in Turkey from an economical and commercial aspect.

In fact the prices in our country are even 53% to 65% lower than the lowest prices in European Union countries which are taken as reference.

For example the price of an originator pharmaceutical for which the lowest price in Europe is 10 Euros and which is already 5.4 Euros in our country has been reduced to 4.7 Euros with the recently issued regulations. Also the price of a generic pharmaceutical for which the lowest price in Europe is 10 Euros and which is already 4.2 Euros in our country is reduced to 3.5 Euros after the latest regulations. (1 Euro is still being considered = 1,9595 TL.)

Contrary to what is thought it has not been easy for the sector to carry this burden. During this process purchases and investments have been reduced in order to cut back on costs. As of the end of 2009, in parallel to the conditions which intensified with the preventive measures that were taken within the scope of a global budget application, the industry has experienced lay-offs, is not able to make new investments, hesitates about presenting new pharmaceuticals to the market and is rapidly losing its globally competitive edge.

While we as the Turkish pharmaceutical industry with a visionary point of view have determined our goal for 2023, the 100th anniversary of the establishment of our Republic, to be globalization and to become one of the important pharmaceutical producing countries of the world, we are arguing the sustainability of our sector today.

We had been aiming to improve our country’s foreign trade balance, increase the contributions we have made to the Turkish economy, to be able to present products in a more economic manner to our social security system with the scale we will achieve with export, increase R&D investments to provide more contributions to the qualified work force, attract direct foreign investment and achieve even more growth at the tax base. Thus our country was going achieve a pharmaceutical industry that had taken on the leadership of its region and arrived at a position of authority in Europe and in the world.

However the conditions we are facing are obstructing the goal of our industry to take the necessary measures to open up to the foreign market and become a production hub.

Also we find companies being required to compensate the damages sustained by pharmacy stocks because of the fall in prices caused by the more recent price regulation and the interference of the government in commercial relations to which they are not a direct party to be harmful.

We, as a sector, are strongly against our pharmacies being exposed to harm. However the way to deal with this is not by constantly making the industry compensate for retrospective stocks but to allow pharmacies a reasonable amount of time to dissolve their stocks and make the necessary organization to enable the price reductions to go into force at the end of this period.

We, as organizations representing the industry have taken legal actions against the neglect to update the exchange rates which determine pharmaceutical prices despite the relevant regulation and the practice of compensation for the stock damages of pharmacies which is an illegal and unjust approach that interferes directly with issues concerning commercial life.

As a result, the latest developments are at dimensions that threaten the very existence of our industry which has undertaken the burden of all regulations implemented in the pharmaceutical sector since 2004 and provided devoted support for the efforts towards conservation.

It appears that the point we have reached will make in inevitable for problems to be experienced in accessing pharmaceuticals if rational applications and regulations are not brought into force.”