The Ministry of Health has issued a Gazette notification stipulating the pricing mechanism for medicines.
Per the Gazette notification, the maximum retail price of a medicine should be determined based on the following factors;
-Cost, Insurance, and Freight
-Duties and Taxes
-The supply chain total markup
- Pricing Mechanism for Maximum Retail Price;
According to the new pricing mechanism, the Maximum Retail Price (MRP) of a medicine is to be determined by considering the exchange rate of the US Dollar based on the average value of the past three months as published by the Central Bank of Sri Lanka.
The Gazette authorizes the National Medicine Regulatory Authority of Sri Lanka (NMRA) to review the Maximum Retail Price twice a year.
The NMRA is vested with the power to revise the Maximum Retail Price of medicines if it considers it necessary in the public interest and if there is a fluctuation of the exchange rate beyond an accepted tolerance level.
- Pricing Mechanism for Maximum Ceiling Price;
When determining the Maximum Ceiling Price of medicines, retail prices across different pharmacies and the market shares of different brands and generics are to be considered using a statistical method involving median retail price.
The Gazette further specifies that medicines cannot be sold above the Maximum Ceiling Price.
Accordingly, if the Maximum Retail Price of a medicine is lower than the Maximum Ceiling Price, it cannot be increased.
For newly registered medicines, if the Maximum Retail Price exceeds the Maximum Ceiling Price, then the Maximum Ceiling Price is to be adopted as the retail price.
The NMRA is authorised to revise Maximum Retail Prices and Maximum Ceiling Prices based on market conditions to improve access to medicines.
The Gazette notification has been issued by Minister of Health Nalinda Jayatissa, dated 25 March 2025. (Newswire)
