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Traders want time to cut prices
By Faraza Farook
The State Pharmaceuticals Corporation (SPC) has reduced drug prices by 5% with immediate effect and ordered private pharmacies selling SPC drugs to also reduce prices- but major drug importing companies say it may take months to give this benefit to patients.

Pharmaceutical Chamber President Nimal Dias Jayasinha said that the public could get the benefit of the price reduction on pharmaceuticals within the next four to six weeks or when new stocks were brought in.

Since importers have already paid the National Security Levy of 6.5% for acquired stocks, the price reduction can be seen only when the new imports arrive which will be free of such tax. All member pharmaceutical companies of the Chamber have been instructed to effect the corresponding reductions with their new consignments, he said.

Mr. Jayasinha said the NSL on pharmaceuticals was charged on a notional profit of 25% on the cif prices and was effectively charged at 8.1%. Most drug companies were reluctant to absorb losses by reducing prices of acquired stocks.

Sri Lanka Pharmaceutical Industry President Upali Panditharatne, who is also attached to Mansel Ceylon Ltd. said prices could not be reduced immediately on the available stocks. "We have 3-4 months stock and we can't cut down on prices immediately. When we come down to a month's stock or less, we will consider bringing down the prices along with the new imports".

However, Gamma Pharmaceuticals said it had decided to absorb losses running into millions of rupees due to the price reduction. Its Chairman Gamini Hewamallika said prices of their commodities have been brought down by 5% absorbing a loss of around Rs. 1.5 million.

The SPC was among many state organisation that decided to absorb losses incurred as a result of the price reduction on already acquired stocks to reflect zero duty on pharmaceuticals from August 1. Accordingly, the SPC wrote off Rs. 20 million as losses, Chairperson Sunethra Ranasinghe said. "Ours is a non-profit making organisation, so we decided to absorb the losses," she said.

Mrs. Ranasinghe said a six percent reduction was being given on wholesale and five percent on retail products. She said all SPC outlets and franchise shops were selling drugs at the reduced rate while private pharmacies selling SPC drugs have also been instructed to reduce the prices.

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