The Pharmacy Price War of 2019

The rising cost of private healthcare and crippled public health service makes it necessary for South Africans to take care of their health. It’s too expensive to get sick in South Africa unless you can brave the long queues and non-availability of staff and medicines at clinics and hospitals.

The face of the South African pharmacy has changed drastically in the last 20 years. The advent of the chain store pharmacy has made it difficult for privately-owned pharmacy owners to keep their businesses afloat.

The major players in the South African pharmacy market are Dis-Chem, Clicks, Shoprite and Checkers Medirite, Pick ‘n Pay Pharmacy and Pharmacy at Spar. They have dispensaries for prescription medication and offer over the counter (OTC) medicines for sale.

They are in fierce competition with each other as well as with independently owned pharmacies.

The single exit price (SEP)

The SEP governs the price of medicine in South Africa. This is the maximum price a pharmacy can charge for a medicine. A pharmacy is also allowed to charge a dispensing fee. The dispensing fee is calculated based on the price of the medication.

The dispensing fee is the main area of competition between pharmacies when it comes to prescription medication. While the prices for medication may be similar, they charge different dispensing fees.

Lower dispensing fees are offered to increase the number of customers using the pharmacy.

OTC medicine is a burgeoning market

The SEP applies to any medication that you can only get at a pharmacy. It does not apply to medicines that you can buy at a supermarket such as paracetamol tablets.

The SEP of all medicines is a click away on https://mpr.code4sa.org, which even enables you to look for generics. This database allows you to know what more or less what your medicine will cost before you arrive at the pharmacy.

Self-help

Winter is a busy time for pharmacies. It is the season for colds and flu. There are plenty of medications that you can get at the pharmacy without having to consult a doctor and obtain a prescription. Prices vary from pharmacy to pharmacy.

Seasonal promotions give consumers the chance to buy these medicines at reduced prices. This can mean saving on your budget. It can also mean reducing the amount of medical aid savings used for pharmacy advised therapy (PAT).

So, who’s the winner?

A recent survey by Business Tech suggests that Dis-Chem offers the best OTC medicine prices, despite an increase of over 13% in its prices. A sample basket of 9 OTC products was purchased at each of the big chain pharmacies.

However, the difference between the cheapest and most expensive baskets was less than R30. This was before promotional prices were considered. The variance then jumped to more than R60.

It was then Clicks which offered the best prices and Dis-Chem dropped to fourth place. In both instances, the Pharmacy at Spar was the most expensive.

Don’t write off your local independent pharmacy either. Many offer competitive prices and dispensing fees. A lot of customers have complained of feeling like more of a number and less of a person at the large chain pharmacies.

They prefer to pay a little extra for more personalised service.

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