The Egyptian Drug Authority has adopted a new mechanism to determine the percentage change in drug prices, based on a weighted equation that takes into account three key economic variables: exchange rate, inflation, and interest rates. This decision was published in the Egyptian Official Gazette on September 23, 2026. The new mechanism aims to link price reviews to actual economic changes.
The equation used to calculate the price change consists of 60% change in exchange rate, 30% inflation rate, and 10% change in bank interest rates. The authority will recalculate the equation every six months, with the option to review prices more frequently in exceptional circumstances. This move is expected to bring transparency and fairness to the pricing of drugs in Egypt.
To increase drug prices, the decision requires a minimum 10% increase based on the equation, with economic variables remaining stable for at least 45 days. Price changes will be implemented based on requests from drug registrants, provided they meet these conditions. This ensures that price increases are justified and reflect actual economic changes.
Conversely, the authority can reduce drug prices if the equation indicates a minimum 10% decrease, with economic variables stable for at least 45 days. The authority will review prices of all drugs on the market every three months. This allows for swift adjustments to prices in response to changing economic conditions.
The decision also outlines procedures for reviewing drug prices upon request from registrants. In such cases, the authority will assess the request based on provided data, with a minimum six-month interval since the last price notification. Registrants must submit relevant documents and data that impact the cost of the drug.
The authority has the right to revisit and adjust drug prices without adhering to the price notification period, based on cost data, reference prices, and economic evaluations. This enables the authority to make informed decisions about drug prices, ensuring they are fair and reasonable.
Additionally, the decision sets profit margins for distributors and pharmacists based on drug category and type. Different margins apply to locally produced drugs on the essential medicines list and those not on the list. This provides clarity and consistency in pricing across the pharmaceutical supply chain.
Key points
- The Egyptian Drug Authority adopts a new pricing mechanism that links price reviews to exchange rates, inflation, and interest rates.
- The mechanism allows for price reviews every six months, with the option for more frequent reviews in exceptional circumstances.
- The authority has the right to revisit and adjust drug prices without adhering to the price notification period.
