Rules governing the pricing of pharmaceuticals in Turkey were materially changed by the Decree Regarding Pricing of Pharmaceuticals dated June 15, 2015 (“Former Pricing Decree”). On December 11, 2015, the Pricing Communique was published for providing details on the implementation of the Former Pricing Decree. At the end of 2016, the Ministry of Health (“MoH”) circulated a revised draft of the Pricing Communique with a proposal of several changes in the pricing rules. Due this proposed draft that the MoH has been working on, amendments to the Former Pricing Decree and Pricing Communique applicable to pricing of pharmaceuticals have been expected.
In light of these developments, on February 24, 2017, a new Decree Regarding Pricing of Pharmaceuticals (“New Pricing Decree”) is published which abolished the Former Pricing Decree. The New Pricing Decree introduced the following main changes without effecting the overall rules applicable to the pricing of pharmaceuticals in Turkey:
- Rules applicable to the 20-year old products have been expected to be changed due to the amendments proposed in the proposed draft of the Pricing Communique. Accordingly, the New Pricing Decree abolished the terminology of 20-year old products. It sets forth that the products any pharmaceutical form of which were marketed in the world before August 1, 1987 for the first time shall be accepted as “products with price protection”.
- The Former Pricing Decree included certain rules for these products (which were previously defined as 20-year products but now referred to as the products with price protection) if they have a price over TL 6.93. The New Pricing Decree increased such threshold to TL 8.09 in relation to all the relevant applicable rules in the New Pricing Decree.
- The country of production, which used to be taken into account for determining the reference price if there was a lower ex-factory price despite the country of production not being a reference country determined by the MoH, has now been replaced by the country of batch release.
- In relation to the 20-year old products and original products with generics, the New Pricing Decree did not change the currently applicable rules requiring them to be priced up to 80% and 60%, respectively, of the reference price under certain circumstances. However, additional detailed rules have been introduced for calculation of these prices in the event of a decrease in the relevant reference prices below the aforesaid ratios.
- The Pricing Evaluation Committee is authorized to price certain exceptional products without being bound by the general pricing rules. One of these exceptional products used to be the ones with an ex-factory price below TL 3.63 under the Former Pricing Decree which has now been changed to products with an ex-factory price below TL 4.24.
- The Pricing Evaluation Committee shall convene within the first 45 days of January each year (the Former Pricing Decree required such meeting to be held within the first 5 business days of January) for fixing the value of 1 Euro to be applicable. Moreover, the period of regular meetings of the Pricing Evaluation Committee has been changed from once in 3 months to once in the first 6 months of each year.
- Changes in the reference prices shall no longer be notified to the MoH by the pharmaceutical companies once in 6 months as the New Pricing Decree changed this notification period to once a year.
- The “reference country” and “reference price” terminology which has been used for many years has now been replaced by “origin country” and “real origin price”.
Provisions of the Pricing Communique shall be applicable until a new communique is issued in line with the revisions of the New Pricing Decree to the extent there is no contradiction. Therefore, the Pricing Communique which provides detailed implementation rules is expected to be revised or re-issued in the upcoming days.