TEL AVIV, Israel - The passage of the Economics Arrangements Bill by the Israeli Knesset earlier this month breaks open the NIS2.5 billion-a-year (US$615 million) pharmaceuticals market, ending the monopoly of designated local drug importers.
In response, a special-interest lobbying organization, Pharma Israel, was founded by the 15 international research-based pharmaceutical companies in Israel.
The group's stated goals are to address the issues raised by the advent of competition from other importers, lobby on behalf of mutual interest, and make the government admit to the need for controls on parallel imports of medication.
Pharma Israel said medicines not supplied by the manufacturer can be adulterated during any of the handling, packaging, storage and transfer steps, and noted that when medicines are handled by other economic operators, it is impossible for the manufacturer to ensure their quality or to guarantee that the medicine is the original and not counterfeit. The group also questioned who would guarantee sufficient stocks; who would supply the less-profitable markets; how patients would recognize different forms of the same drug; who would be accountable for defective medicines; and how patients harmed by parallel imported drugs might be able to seek compensation from the companies abroad.
Pharma Israel said the difference between current prices and those of parallel importers would not be able to make up for the expense of the additional government supervision and monitoring required with parallel imports.
"We saw the new law coming," said Sophie Kornowski, managing director of Merck-Israel. "A tremendous amount of political pressure was being put on the government to get it through. Now we have organized to rebalance the situation. The gap between the theory and the application of the new law is wide. The money saved would not be worth the risks that could be posed to the public by importing lower-quality drugs through non-regulated sources."
Even before the formal lobby was formed, foreign drug-company representatives had actively campaigned against the combined initiative of the ministries of health and finance and the health fund, hoping to regulate - if not disallow - parallel imports.
A health ministry spokesman said mechanisms and regulations that would ensure proper supervision would "soon be in place."