Inflation hits drug business

Press, Volume CXV, Issue 33928, 22 August 1975, Page 8

Inflation hits drug business

Against a background of rising hospitalisation and health costs generally, medicine suppliers are fighting a losing battle against inflation, for which they can find no cure.

Like most New Zealand industries, ‘ pharmaceutical manufacturing had been hard hit by inflation, and because the drug business was international, combating inflation had been doubly difficult, said the director of the Pharmaceutical Manufacturers’ Association (Mr R. W. Martin).

“Research costs are high, general administration and expenses are up, and raw materials are in a cost spiral, quite apart from the impact of oil prices on those materials which are petroleum-based,” he said. ■Shipping and packing costs had all soared, which meant that New Zealand pharmaceutical companies had been hard hit by inflation even before they started to count the cost of similar increases in New Zealand.

The keeping down of costs had so far been “spectacular,” and medicine prices had so far been hgld relatively stable. “Medicines at the manufacturing and import level represent- only about 5 per cent of New Zealand's total health bill,” Mr Martin said.