Pharmaceutical reform or its imitation? Who really benefited from the reduction in medicine prices in Ukraine

In early 2025, the Ukrainian government announced a price reduction for the most popular medicines. The President, the National Security and Defense Council, and the Ministry of Health promised that starting in March, prices for 100 types of drugs would be reduced by 30%. However, in reality, the results were completely different; this initiative only strengthened the positions of large pharmaceutical manufacturers and did not make medicine more accessible to the general public.

On February 5, President Volodymyr Zelenskyy called for a reduction in the prices of medicines in his address. The response was the signing of a declaration of support for the initiative between the “Pharmacy Professional Association of Ukraine” and the Ministry of Health. Already on February 12, the National Security and Defense Council adopted a decision on the intentions of pharmaceutical market participants.

The decision states that starting March 1, 2025, it is planned to reduce the prices of basic medicines in high demand. On the same day, the President signed a corresponding decree.

The Ministry of Health announced that the prices of 100 medicines will be reduced starting from March 1, with an additional 100 to follow by the end of the month.

Who sets the price of medicines?

To understand the possibility of a price reduction, journalists analyzed the structure of the pharmaceutical market. 72% of the price is determined by manufacturers, 20% by pharmacies, and 8% by distributors.

Among the leading manufacturers are Farmak, Atsino, and Arterium. Before the war, their market value exceeded $1.6 billion, and during the war, their profits continued to increase.

What decreased in price?

The government announced a “price reduction for 100 medicines.” Still, it should be clarified that this does not refer to 100 active substances or brands but to 100 names – different packaging and dosages of the same substance.

Currently, there are no drugs for the treatment of oncology, cardiovascular, or other serious diseases on the list. For example, one company reduced the price only for Ibuprofen in a package of 50 tablets, while other options remained unchanged.

Financial maneuvers and price increases before the “reduction.”

Before the announced reduction, prices for “cheaper” drugs rose sharply. For example, the cost of Ibuprofen began to increase in October, peaked in January, and, after March, returned to the autumn level. Citramon also rose in price.

So, the actual “reduction” is just a return to the previous price category.

Marketing as a method of generating profits

Comments by a representative of one of the prominent Ukrainian pharmaceutical companies revealed the inner workings of the pharmaceutical industry. In 2024, the company sold:

6,000 packages of “Nalbuphine” by prescription;

about 3 million packages in total;

the drug took 4th place in sales.

Pharmacy market lobbyists confirmed that they are selling “Imustat,” which has a warning from the WHO. A representative of the pharmaceutical company noted that over the past two years, drug prices have increased by 120%, of which only 30% is attributed to inflation, and the rest is due to increased marketing costs.

Up to 23% of the drug price is marketing costs, which is the amount that companies pay to pharmacy chains for placing their products.

The President, pharmacies, and the search for the guilty

As part of the price reduction campaign, the culprits are considered to be pharmacies that allegedly demanded excessive payments for marketing services. Manufacturers have appealed to the President with these reductions.

However, the question arises: why did the reduction affect only a few dozen inexpensive drugs, and why do the most prominent manufacturers, despite the memorandum, not seek to reduce prices for the entire range?

“Excessive profits” against the background of the memorandum

After the cancellation of marketing agreements, one of the companies reduced prices by only 20 items but continued to receive excess profits at the same time. The question arises: who benefited from this reform?

Manufacturers, without a doubt.

Parliamentary lobby: on the side of pharmaceutical manufacturers?

People’s Deputy Serhiy Kuzminykh actively supports the cancellation of marketing services but believes they will not be eliminated but rather regulated. It is essential to note that the politician is under investigation for bribery in connection with the provision of equipment to a hospital.

Consequences: what did Ukrainians get?

Populism, loud statements, and the absence of changes in first-aid kits:

Prices decreased only for a limited number of drugs;

The absolute reduction in the price of drugs is a big question;

Manufacturers retained excess profits;

Pharmacies in rural areas may disappear;

The pharmaceutical market is becoming more monopolized.

The grand initiative to lower drug prices ultimately proved to be primarily a public relations stunt. The real benefits went to big players in the market, while Ukrainians, especially in low-income and remote communities, could lose even the minimal access to medicines they had before.

The main problem was that the same interests often lurked behind the bright statements and decrees of presidents: profit above all else.