Tbilisi: Reference price for drugs to be effective from February 16, 2023

Tbilisi: The Georgian Minister of IDPs, Labor, Health and Social Protection, Zurab Azarashvili, publicized that From today i.e. February 16, 2023, the Reference price for drugs has been activated.

“I’m so glad that several companies took this into consideration and have regulated prices significantly on certain medications. This is the first stage, and in the coming period, we will continue to impose reference prices on other groups of medicines“, stated Azarashvili.

According to the health minister, the reference price has been applied to more than 800 chronic and oncological medications. Overall, the reform will reduce the cost of drugs in the country by 40%.

The Minister also paid attention to procedures for setting a reference price for drugs and implementation. Zurab Azarashvili noted that the changes on the part of medicines, which were charged by the pharmaceutical sector, will come into effect from March 15.

“Of the more than 1200 medications, some have been sued. That’s why, today, more than 800 drug reference prices came into effect. The remaining 400 drug costs have been reviewed, and they already have a new 1-month expiration. Overall, from March 15, all 1200 medicines will have a reference price”, – said Zurab Azarashvili.

The Minister emphasized that this methodology of calculating the price of medicines is a practice in Europe and other countries of the world.

“Overall reference price and margins, which we have determined for pharmacies, are derived from the price of similar medicines in other countries. This, overall, is the fair margin that this segment and this industry should have. In many different and much higher income countries, if these prices are acceptable – where GDP is far above per capita, and economically ahead, then there should be no problem in our country. 

“We leave the sector a necessary and fair margin, which is necessary and essential for the functioning of both wholesale and retail companies,” Zurab Azarashvili said.

Notably, in order to increase access to medicines for the population, the state has set a maximum limit on the cost of chronic and oncological medications, at which the highest price, they will be prohibited.

The reference price set for medicines is different from the original and its analogue for generics, which will ensure the interest of international brands in the market.