This year, pharmaceutical companies have repeatedly raised the supply prices of over-the-counter drugs and drink products sold in pharmacies and convenience stores. This is due to rising raw material costs and increasing labor costs caused by high inflation.
On the 2nd, according to the pharmaceutical industry, Kwangdong Pharmaceutical plans to increase the wholesale prices of its pharmacy drink products uniformly starting in May. The prices of three types, including "Ssanghwa-tang," "Won-tang," and "Ginger Ssanghwa," are set to rise by about 10%. Ssanghwa-tang and Won-tang are over-the-counter drugs used for colds, body aches, and fevers, while Ginger Ssanghwa corresponds to liquid tea.
Over-the-counter drugs are medications that buyers can purchase directly at pharmacies or convenience stores without a doctor's prescription. Advance notices of "price increases" have already circulated among the sales representatives at local pharmacies, but the company has said it is considering a price increase, though the exact increase rate has not yet been finalized. If the wholesale price increase is around 10-11%, the retail price for consumers is expected to rise by about 100 won. Previously, Kwangdong Pharmaceutical raised the wholesale price of its drink product "Vita500" by 7.6% starting in February.
The wholesale price of JW Pharmaceutical's eye drops, "Friends Eye Drop," has also increased by about 8% since this month. The saline solution "Clean Cl 1L" is expected to rise by 8.7% starting next month. The wholesale price of GC Biopharma's anti-inflammatory pain reliever "Tacen" was also increased last month. The increase rate compared to the previous price was 16%, marking the first rise in over two years since January 2023. Tacen is a non-steroidal anti-inflammatory drug.
Dong-A Pharmaceutical has also raised the wholesale price of its fatigue recovery product "Bacchus" by about 11% since last month. The price increase for Bacchus D sold in pharmacies is the first in three years and four months since November 2021, while the Bacchus F distributed in convenience stores and supermarkets has seen its price raised for the first time in three years and three months since December 2021.
Dong Sung Bio Pharm has raised the wholesale price of its diarrhea and vomiting medication "Jeongro-hwan" by 10% since March. This is the first price increase for Jeongro-hwan in over two years. Additionally, AHNGOOK PHARMACEUTICAL has raised the supply price of its constipation treatment "Polaxan" since February. Polaxan 4g has increased by 17%, while Polaxan 10g has increased by 10%. The supply price of With One Bio's motion sickness medication "Kimite" has also risen by 7.9% since February.
Pharmaceutical companies that have decided to raise prices unanimously state that it is an unavoidable measure due to high inflation pressures. Each company noted, "We have tried to suppress supply price increases as much as possible, considering the burden on customers, but we have had to decide on price increases due to the ongoing rise in raw material and manufacturing costs."
If the trend of rising prices continues, there are forecasts that the prices of other medications may follow suit. A representative from one pharmaceutical company said, "Every year, labor costs, manufacturing prices, and production costs rise, so we have no choice but to raise delivery prices."
The rising won-dollar exchange rate is also a factor increasing price pressures on domestic pharmaceutical companies. Domestic pharmaceutical companies mostly rely on imports for raw pharmaceuticals. Even when conducting large transactions of raw pharmaceutical materials from China and India, they mainly trade in U.S. dollars, so increases in the won-dollar exchange rate can heighten cost pressures.
The same applies to cases where basic substances and raw materials are imported and processed and produced domestically. The increase in the won-dollar exchange rate results in a decline in production profit margins compared to before. In the foreign exchange market, there are predictions that the strong dollar in the United States will keep the won-dollar exchange rate on an upward trend until the second quarter of this year. It has also been suggested that if uncertainty increases, the upper limit of the won-dollar exchange rate could soar to 1,500 won.