Drug tax increased, medicines to disappear from Hungarian pharmacies

The Orbán cabinet issued a decree on Wednesday, 31 May, which changed the rules on extra taxation of pharmaceutical companies. This new regulation is a clear threat to pharmaceutical manufacturers, which could result in serious medicine shortages.

The government has promulgated a decree changing the rules on extra taxation of pharmaceutical companies. According to this, from 1 July, manufacturers and distributors will have to pay an extra tax of 20 percent on subsidised medicines with a producer price of less than HUF 10,000 (EUR 27), and 40 percent on medicines with a higher price, instead of the 28 percent previously paid, Népszava reports.

According to the news portal, the consequences of the move are not yet being discussed by international manufacturers. They are presumably waiting for the headquarters to decide whether they will continue to sell the products concerned on the Hungarian market under these conditions or whether they will withdraw them. If the latter is the case, it could affect patient care on several fronts.

There are already intermittent shortages of modern medicines, such as insulin, anticoagulants and cancer nutrients. The extra tax could significantly expand this list and include life-saving products such as the adrenaline auto-injector, which costs a few tens of thousands of forints and is used for severe allergic attacks, Népszava writes.

They add that it is not only cutting-edge drugs that may disappear from pharmacies, but also generic (post-manufactured) medicines. These now include biological drugs, such as therapies for arthritis and various haematological diseases. In total, there are about 500 subsidised generic medicines over HUF 10,000 in pharmacies in Hungary. The health insurance provider spends about 20 percent of its medicine budget on this group of medicines.

According to a pharmaceutical market analyst interviewed by the newspaper, this segment is most at risk with the newly introduced 40 percent extra tax, as many of the active agents in this group are only generic, and if they are not worth selling, they will not be available.