Hungarian pharma manufacturers call for conciliatory forum

Erik Bogsch, president of the Hungarian Manufacturers Association and chief executive of Richter Gedeon, has called for a conciliatory forum to find ways to reduce the burden imposed on both drug manufacturers and wholesalers by the Pharma-Economic Act passed in November 2006 (Marketletters passim). He said at a recent press conference held by the pharmaceutical industry associations of Hungary that the government broke the pharmaceutical truce. The recent reform measures threaten the future of local drugmakers as they force them to revise their investment plans, reduce their workforce as well as to remove some important drugs from their product list.

Other leaders of the Hungarian sector also warned that the Ministry of Health ignores the professional views and forecasts of the drugs industry experts and neglects negotiations with pharmaceutical manufacturers. Frederic Ollier, managing director of Sanofi-Aventis Hungary called for the Ministry of Finance and Economics to join in the dialog to ensure that the contribution of the industry to national economy is not ignored.

Mr Bogsch emphasized that the reform measures introduced since the fall of 2006 will mean 20.0 billion forint ($100.6 million) extra costs for manufacturers. Richter will have to reduce its planned investment budget 10.0 billion forint while Egis-Servier is considering the withdrawal of 70 drugs (with a sales value of 1.5 billion forint) from the Hungarian market. Teva Hungary said the sharply increased costs have forced it to reconsider its $100.0 million investment plan, too. According to Mr Ollier, Sanofi-Aventis' head office has recently redirected a significant investment to another country due to the unpredictable market environment in Hungary. In the last five years the company invested 420.0 million euros in Hungary but increased taxes and lost revenue will now cost them 10.0 billion forint.