Punishments too lenient to prevent medicine monopolies raising prices

will soon publish a price guide for short-of-supply medicines and bulk pharmaceutical chemicals and they are seeking opinions from the public. Legal Daily comments:

The guide, if well implemented, can curb the price of medicines from rising when they are in short supply, which has been a long-term problem given the monopoly supply of some pharmaceutical drugs.

The price supervision departments have investigated dozens of cases of monopolistic pharmaceutical companies fixing medicine prices since 2011.

Two pharmaceutical companies, one in East China’s Zhejiang province and one in Tianjin in North China, were recently fined about 444,000 yuan ($66,000) in total for abusing their market dominant positions.

The punishments that the judicial authorities can mete out to price controllers according to the Price Law remain too light to curb such practices.

The leniency of the Price Law means it encourages the lawbreakers since any fines they receive

are regarded as a sort of small tax that the businesses pay for their exorbitant profits.

Hopefully, the public will take the opportunity to make their opinions on medicine pricing heard by the rule-makers and pharmaceutical companies will take the initiative to regulate their prices in accordance with the guide prices when they are introduced.

But the price guide is only an expedient measure. Apart from the law, there should be a blacklist for the manipulating the price of medicines.

Once on the list, the enterprises should be banned from being involved in the pharmaceutical industry for a certain period of time or permanently, depending on the severity of their illegal acts.

However, the fundamental solution is to break the monopolies producing some pharmaceutical drugs.