Aussies pay 10 times more for medicine than Brits – and they're sick of it

Three consumer groups and the Australian Council of Social Service are joining forces against pricey prescriptions.

a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Aussies are sick of paying too much for medicine. Three consumer groups and the Australian Council of Social Service announced yesterday that they are joining forces to launch a new campaign against pricey prescriptions.

More specifically, these groups are urging consumers to support price disclosure, a process that allows the Australian government to benchmark prices against global averages. According to the Consumer Health Forum of Australia's (CHFA) press release, Australians can pay up to 10 times the British price for medication, and 15% of Aussies currently struggle to cough up funds for their prescriptions.

This latest move comes in opposition to a campaign supported by the Pharmacy Guild that, according to CHFA, is meant to keep profits packed for chemists. While the Guild is requesting $150 million in compensation for costly price disclosures, CHFA Chief Carol Bennett points to billions in government subsidies that pharmacists already receive under the Pharmaceutical Benefits Scheme.

For the Guild's part, it believes this latest campaign is "quite deliberately" misleading the public and that the groups involved "should be ashamed to put their names to such distortions of the truth and should be condemned for their baseless scare tactics." The guild denies asking for price disclosure changes, as well as any prescription price hikes.

According to the Guild, its main objective in revising current provisions is to ensure that pharmacists are adequately paid to keep operations sustainable and accessible. More specifically, it warned that 410 single-pharmacy towns could lose their one source of medicine as cash-strapped stores close. As a final note, the Pharmaceutical Guild also disputes CHFA's Aussie-to-Brit cost comparison, noting that Australia has of the lowest pharmaceutical spends as a percentage of GDP in the world.

Foolish takeaway

Any health care issue packs a hard political punch, and the price of medicine is staunchly stuck between consumer concerns and pharmaceutical interests – both powerful blocs. If price disclosures do continue, companies like Sigma Pharmaceuticals (ASX: SIP), Mayne Pharma (ASX: MYX), and Australian Pharmaceutical Industries (ASX: API) could see squeezed margins. On the other hand, if Bennett's claim that Aussies are currently choosing between food and prescriptions is true, more affordable medicine could make up in volume sales what it loses in margins.

For long-term investors, picking the best company goes beyond political piddles. Aussies will always need medicine, and the company with the strongest value add will continue to thrive in future years – no matter what we pay our pharmacists.

The Australian Financial Review says "good quality Australian shares that have a long history of paying dividends are a real alternative to a term deposit." Get "3 Stocks for the Great Dividend Boom" in our special FREE report. Click here now to find out the names, stock symbols, and full research for our three favourite income ideas, all completely free!

More reading


Motley Fool contributor Justin Loiseau has no position in any stocks mentioned in this article. You can follow him on Twitter @TMFJLo.

More on ⏸️ Investing

Close up of baby looking puzzled
Retail Shares

What has happened to the Baby Bunting (ASX:BBN) share price this year?

It's been a volatile year so far for the Aussie nursery retailer. We take a closer look

Read more »

woman holds sign saying 'we need change' at climate change protest
ETFs

3 ASX ETFs that invest in companies fighting climate change

If you want to shift some of your investments into more ethical companies, exchange-traded funds can offer a good option

Read more »

a jewellery store attendant stands at a cabinet displaying opulent necklaces and earrings featuring diamonds and precious stones.
⏸️ Investing

The Michael Hill (ASX: MHJ) share price poised for growth

Investors will be keeping an eye on the Michael Hill International Limited (ASX: MHJ) share price today. The keen interest…

Read more »

ASX shares buy unstoppable asx share price represented by man in superman cape pointing skyward
⏸️ Investing

The Atomos (ASX:AMS) share price is up 15% in a week

The Atomos (ASX: AMS) share price has surged 15% this week. Let's look at what's ahead as the company build…

Read more »

Two people in suits arm wrestle on a black and white chess board.
Retail Shares

How does the Temple & Webster (ASX:TPW) share price stack up against Nick Scali (ASX:NCK)?

How does the Temple & Webster (ASX: TPW) share price stack up against rival furniture retailer Nick Scali Limited (ASX:…

Read more »

A medical researcher works on a bichip, indicating share price movement in ASX tech companies
Healthcare Shares

The Aroa (ASX:ARX) share price has surged 60% since its IPO

The Aroa (ASX:ARX) share price has surged 60% since the Polynovo (ASX: PNV) competitor listed on the ASX in July.…

Read more »

asx investor daydreaming about US shares
⏸️ How to Invest

How to buy US shares from Australia right now

If you have been wondering how to buy US shares from Australia to gain exposure from the highly topical market,…

Read more »

⏸️ Investing

Why Fox (NASDAQ:FOX) might hurt News Corp (ASX:NWS) shareholders

News Corporation (ASX: NWS) might be facing some existential threats from its American cousins over the riots on 6 January

Read more »