The Egyptian Drug Authority (EDA) is preparing to issue new pricing regulations introducing a dynamic economic formula to adjust local pharmaceutical prices based on exchange rate fluctuations, inflation, and interest rates, alongside a comprehensive restructuring of pharmacy profit margins and discount rates, according to an official at the authority and two sources at the Cairo Pharmacists Syndicate.
Before the establishment of the EDA in 2019, price adjustments were enacted through Health Ministry decrees. The latest of which, Decree No. 499 of 2012, had governed price reviews if foreign exchange rates moved by 15% upward or downward within a single year, or permitted pharmaceutical companies to request price reviews for a maximum of 5% of their registered products annually, divided equally into quarterly tranches.
Detailing the proposed mechanism, an EDA official who spoke to Al Manassa on the condition of anonymity said the authority conducted a community dialogue with pharmacists’ syndicates, the Chamber of Pharmaceutical Industry, and distribution companies.
The talks aimed to reach consensus on proposed pharmacy discount rates and explain the new price adjustment mechanisms scheduled for publication next month.
According to the official, the new mechanism relies on a unified economic index that determines when price review submissions open. The index is built on three key variables: the US dollar exchange rate carries a 60% weight as the main determinant of imported raw material costs, inflation carries a 30% weight, and interest rates carry a 10% weight.
This formula will undergo periodic review, opening the door for companies to submit repricing requests whenever the total weighted change reaches 10% upward or downward, the official said.
Crossing this threshold will not trigger automatic price increases. Instead, it allows companies to submit applications to the Pharmaceutical Pricing Committee, which will determine which medications merit review and set appropriate percentage increases. The committee will continue to receive individual requests even during periods of economic stability.
Regarding pharmacy profit margins, the EDA agreed with local pharmacist syndicates to eliminate the additional profit margin of 1 Egyptian pound per pack in exchange for raising the pharmacy discount rate on essential domestic drugs from 20–23%, and on non-essential domestic drugs from 25–27%. Discounts on imported drugs will be restructured to range between 15% and 20%, an informed source at the Pharmacists Syndicate said.
However, these increases will exclude oncology drugs and high-priced pharmaceuticals, according to a second source at the Pharmacists Syndicate.
The agreement establishes a fixed profit margin schedule for high-cost medications: 4,000 Egyptian pounds for packs priced above 100,000 pounds; 3,000 pounds for packs between 50,000–100,000 pounds; 2,000 pounds for packs between 20,000–50,000 pounds; and 1,000 pounds for packs priced between 10,000–20,000 pounds.
During the meeting, syndicate representatives also demanded a uniform cash discount of 3.5% on the total value of drug orders without excluding imported medications. The head of the authority agreed to study the proposal and discuss its implementation with distribution companies, according to the second syndicate source.
In a technical measure aimed at eliminating dual pricing for identical product packs in the market, the same syndicate source explained that authorities will complete the implementation of the pharmaceutical tracking system.
Under this system, printed prices on packages will be phased out and replaced with QR codes, allowing consumers and pharmacists to check official prices centrally updated by the EDA.
Commenting on the upcoming changes, Mahmoud Fouad, executive director of the Egyptian Center for the Right to Medicine, stressed that establishing fair, scientific pricing standards has become an urgent necessity to balance industrial sustainability with citizens' rights to medical treatment.
Fouad told Al Manassa that while improving profit margins for pharmacies and factories is vital to ensure service continuity, it must not come at the expense of patients, the chronically ill, and the elderly who rely on strategic medications daily.
Fouad noted that since 2018, the drug market has experienced six waves of across-the-board price hikes outstripping income levels. This escalation has increased direct out-of-pocket healthcare spending and forced some patients to purchase “half a blister pack” because they cannot afford an entire box.
He called on the government to grant customs and tax exemptions, as well as concessions on production inputs, for strategic chronic disease medications to ensure price stability without further burdening patients.
Regarding the unified digital tracking system and ending dual pricing in pharmacies, Fouad noted that while the measure is crucial for regulating the market and streamlining pharmacy operations, its implementation will impose direct financial burdens on patients.
By forcing consumers to pay the latest centrally updated price, low-income citizens will be deprived of purchasing older inventory produced under previous, lower price tiers.
