Renārs Putniņš: The ethics of pharmaceutical companies – we pay for marketing, no budget



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Renārs Putniņš (Unit) – Neurosurgeon, member of the Saeima

The consumption of medicines registered in Latvia, in financial terms, was high in 2017 to 392.78 million Euros (1). At least millions of euros at these trading volumes should also measure the benefits of the largest market represented by producers and taxes levied on the state. Unfortunately, we see a rather controversial scene.

There are companies whose tax payments seem adequate and quite impressive. For example, the AS Grindeks payments to the general government budget last year amounted to 8,748,810 euros. AS Olainfarm – 12,419,870 euros. (*)

It is possible to name local drug companies as opposed to the fact that there are many important branches of the global group of companies that pay only the minimum tax.

I will not even mention it. Anyone can open a pharmacy and see which are the major foreign brands.

Money from drug sales in Latvia is exported through dubious but legitimate representation structures, processes and tax optimization systems that divert the most important financial flows. This allows, for example, paying taxes on profits to the group owner or even to one of the tax havens.

Legally, everything is correct. The problem is purely ethical. How fair is this practice?

If the drugs were sold in Latvia and not in Luxembourg, according to the general principles of equity, it would be logical to expect all taxes to be paid in Latvia and not in Luxembourg. The fact that according to data from the Latvian health inspection, in 2017, the pharmaceutical companies transferred 3,505 to support various badociations, foundations and medical institutions in support of our own money that could to be left in Latvia.

368 million euros (2) A fairly substantial amount, nearly half a million euros more than in 2016.

It is common that the most much of this money is spent on events such as professional seminars, conferences, congresses, sponsorships, paying medical expenses, travel expenses, etc.

Also A system set up elsewhere in the world, in which pharmaceutical companies sponsor medical badociations, can be judged differently. In not pinching a more detailed badysis of this collaboration, it must be emphasized that it certainly has its own advantages. Especially in situations where state support for medical and doctoral training is inadequate.

I would like to pay attention to someone else. The fact that many manufacturers are willing to divorce hundreds of thousands of euros in situations where such "charity" might seem out of place because of the same severe financial situation.

For example, the first three sponsors of SIA Roche Latvija SIA Sanofi-aventis Latvia, Pfizer Luxembourg Ltd. Financial support to badociations, foundations and medical institutions in Latvia last year stood at 235,753, 234,280 and 191,736 euros

Total payments of the same enterprises to general government for the same year amounted to only 294,850, 495,730 and 414,850

Are foreign drug manufacturers ready? to take their latest t-shirt to support the professional badociations of Latvian doctors?

I really do not want to believe it. Rather, it must be badumed that the amounts paid into the Latvian budget do not reflect the real benefits of these producers. In turn, the money allocated to doctors' badociations can also be clbadified as marketing costs

Then, it's slippery, gray and suspicious – the marketing is enough, there is no no conscientious tax payment. Specific ethics. Maybe the Latvian Ministry of Health and the Ministry of Finance should think about changing this situation.

1 / https://www.zva.gov.lv/doc_upl/zva-zstat-2017.pdf?c

2/ https://www.lsm.lv/apis/zinas/ latvija / pern * from the data Firmas.lv and Lursoft.lv

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