20 Oct 1997

20 October 1997

Medicines and Related Substances Control Amendment

This Bill provides for the supply of more affordable medicines to the
people of South Africa, and for the tightening up of safety regulations
concerning the manufacture, preparation and dispensing of medicines in
South Africa.

The Supply of Medicines in South Africa

Under present legislation, only medicines registered in South Africa
can be imported and supplied to pharmacies, hospitals and patients. It
is not currently possible for pharmacies to obtain or dispense `generically
equivalent` medicines - medicines which contain the same active ingredients
and are identical in dose or concentration and dosage form to the registered,
branded medicines, but which are usually considerably cheaper.

Parallel Importation

The Bill proposes to allow the `parallel importation` of medicines,
which means buying an identical product made by the same company, but from
a location other than where the South African distributor purchases it
- and at a lower price.

It will also be permissible to import medicines not currently registered
in South Africa if they are generically equivalent (ie identical
in every way except name) to medicines already registered in South Africa.

South Africa recognises the intellectual property rights of manufacturers
of patented medicines and will only parallel import from countries and
companies which also recognise patent rights and which include the accepted
patent cost in the overall price of the generic equivalent medicine.

Prescribing Generically Equivalent Medicines

Doctors and other health professionals issuing prescriptions will be
permitted to prescribe generically equivalent medicines, instead of branded
medicines. Moreover, whenever a person takes a prescription to a pharmacist,
the pharmacist will have the following obligations:

  • to inform the person of the benefits of substituting the prescribed
    medicine with a generically equivalent medicine
  • to dispense a generically equivalent medicine, instead of the medicine
    prescribed, unless expressly forbidden to do so by the patient.

A pharmacist will not be permitted to dispense a generically
equivalent medicine if:

  • the person prescribing the medicine has written `no substitution` in
    his/her own handwriting on the prescription
  • the retail price of the generically equivalent medicine is higher than
    that of the prescribed medicine
  • the product has been declared unsuitable by the Interim Pharmacy Council
    of South Africa, or its successor.

Pricing Committee

A pricing Committee is to be established to advise the Minister on a
transparent pricing system for all medicines, to monitor the pricing of
medicines and advise on an appropriate dispensing fee.

Bonusing and Sampling

Bonusing is an incentive system used by pharmaceutical companies to
encourage pharmacists or other licensed dispensers to supply their medicine
in preference to another. Sampling is a system under which manufacturers,
wholesalers or agents supply free medicines to pharmacists or other licensed

Both bonusing and sampling will be banned, as will any other rebate
system or incentive scheme.

Code of Ethics

A code of ethics will be prescribed by the Minister relating to the
marketing policies of pharmaceutical companies.

Safety Regulations

In order to improve safety, while at the same time improving efficiency,
new regulations will:

  • require medical practitioners, dentists, practitioners, nurses and
    any other registered person to be licensed before being allowed to dispense
    medicines (Note: all doctors - whether licensed dispensers or not - will
    still be permitted to carry an emergency bag containing medicines to treat
    patients in emergency situations)
  • require manufacturers, wholesalers and distributors of medicines or
    medical devices to apply to the Medicines Control Council for a licence
    before being allowed to manufacture or supply such medicines or medical
  • increase the powers of inspectors to enter any premises in which medicines
    are manufactured, stored, compounded or dispensed; and to enter any premises,
    place, vehicle, vessel or aircraft if there is reason to suspect that an
    offence has been or is being committed or attempted.

Key Political Messages

  • This legislation is a major step forward in the drive to improve South
    Africa`s access to cheap, safe, quality medicines.
  • The cost of medicines to patients, hospitals and medical aid providers
    is being cut.
  • The wealthy pharmaceutical companies oppose the Bill, because it reduces
    their scope for making excessive profits, but the South African medical
    aid industry welcomes the Bill, because it reduces costs to patients.
  • The discredited practice, employed by some pharmaceutical companies,
    of providing free samples, bonuses, perks and even free holidays to medical
    professionals for prescribing and dispensing their drugs will become a
    thing of the past
  • The Health Department will be able to use savings on the cost of medicines
    for improving the health of the nation, instead of lining the pockets of
    pharmaceutical fat cats.
  • The Bill, for the first time, gives patients a real choice in what
    medicines they are being prescribed.