Southeast Asia’s largest economy to lower drug prices

Tarruna Ikrar, president of the country’s Food and Drug Monitoring Agency (BPOM), said the leader has instructed the agency to adjust drug prices so that they at least match the prices of generic drugs or those in neighboring countries such as Malaysia, the Philippines, or Singapore. He said that the agency will work with the ministries of Health and Commerce to address the issue.

The official said that medicine prices in Indonesia are up to 400% higher than those abroad as pharmaceutical companies have to pay high promotion and advertising.

Besides, high cost of raw materials, with 80-90% of finished product ingredients being imported, is a significant factor driving up the price of medicines.

Another factor contributing to higher drug prices is the lack of alternative drugs with the same active ingredients for certain original medications.

To solve the challenges, Tarruna Ikrar suggested that the government regulate drug prices by implementing a more balanced price ceiling, ensuring prices that consumers can afford while also ensuring fairness for the pharmaceutical industry.

Earlier, Indonesia’s Health Minister Budi Gunadi Sadikin acknowledged that drug prices in the country are 3-5 times higher than in neighboring countries. One of the reasons for this is the inefficient distribution channels and lack of transparency in management.