Name day: Simona, Apolonija

In 2019, the Competition Council pointed out that medicines were more expensive for Latvian buyers than in neighbouring countries, and the state does not restrict retailers' markups. Later, the State Audit Office also took an in-depth look at oncology medicines.

Last year, the state changed the formula for setting the prices of prescription medicines. Firstly, it stipulated that the price set by the drug manufacturer in Latvia must not be higher than the price offered in neighbouring countries. Secondly, it introduced a fixed mark-up for both wholesalers and pharmacies. In addition, a pharmacist service fee was introduced, which is partially covered by the state, with 75 cents paid by the resident. In the run-up to the elections, politicians agreed that the state would cover the entire pharmacist service fee for medicines costing up to ten euros. The changes are currently scheduled to come into force on July 1st.

Of the 3,635 prescription drugs currently registered, the pharmacy price has been reduced for 3,285 drugs (90%), increased for 344 drugs, and remained unchanged for six drugs, according to the Ministry of Health.

As expected, price increases have been observed in the cheapest price group - up to five euros, where prices have risen by an average of 21% or 0.50 euros. Medicines in the 5-10 euro price group have become cheaper by 0.92 euros. Prices for medicines above €10 have fallen by about a fifth.

However, pressure from the industry is not letting up. Wholesalers are now demanding higher markups on the most expensive medicines. "This is the segment of very expensive medicines, where one package costs thousands, but the permitted markup is 50 cents per box. This does not cover delivery costs, transportation, the entire cold chain, or anything. So this segment is generating losses," J?nis L?b?ens, board member of the Latvian National Medicines Supply Association, explained to the program.

The Ministry of Health admits that these changes could be introduced from July 1st. "Markups of [medicines costing] up to five euros will become slightly cheaper - possibly by 10 cents, but for patients who buy cheap medicines and several of them, this can be significant. On the other hand, markups on more expensive medicines above 100 euros may become slightly more expensive," said Inese Kaupere, director of the Ministry of Health's Pharmacy Department.

Changes to over-the-counter medicines had not been evaluated until now. The State Agency of Medicines has prepared this data at the request of "De Facto". It reveals that last year, compared to 2024, the average price of non-prescription medicines increased by 3.6%. For the majority (293) of these medicines, prices have not changed. However, the prices of 112 medicines have increased.

The possibility of limiting prices for over-the-counter medicines is currently being assessed. This could possibly be achieved by introducing a fixed markup for these medicines as well.

"Most likely, this would be a fixed markup rather than a percentage markup or a markup plus adjustment amounts. But determining the optimal level so that prices can be reduced significantly, but not so much that the medicines are no longer attractive to retailers, requires careful analysis," said Sergejs Akuli?s, Deputy Director of the State Agency of Medicines for Pharmaceutical Issues.

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