The Association of Generic Medicine Producers in Romania (APMGR), association representing the interests of the main investors present on the Romanian market, asks the authorities to recalculate the cuantum of the clawback tax for the fourth quarter of 2012, in order to eliminate from the calculation base of the clawback tax, the VAT rate corresponding to the total value of sales of drugs, thus respecting the Romanian Constitutional Court’s decision from February 5, 2013.
„It’s absolutly necessary that authorities implement the Constitutional Court’s recent decision on removing the VAT rate from the clawback tax base,”said Dragos Damian, President of the Association of Generic Medicine Producers in Romania. APMGR repeatedly requested the National Health Insurance House (CNAS) a clarification on the amounts reported for the fourth quarter, but received no clear response.
The amounts reported for the Q4/2012 are similar to those of the previous quarter and, correlated with internal corporate data, confirms that the notifications sent by CNAS continue to include the VAT rate. This happens, even if on February 5, the Constitutional Court decided that the application of the clawback tax to another tax is contrary to the constitutional provisions on the fair distribution of the tax burden, which is why the inclusion of the VAT in the total value of medicine sales in relation with which the clawback is calculated, is unconstitutional. „said Damian.
The misinterpretation of Government Emergency Ordinance 17/2012 further requires generic manufacturers to pay a percentage applied not only to the price of the medicines, but also to tax on the value-added corresponding to the price of medicines, which is equivalent to a tax on another tax that companies already pay to the Romanian state.
APMGR repeatedly warned that the current form of clawback tax is unfair, unsustainable and will destroy the local pharmaceutical industry, with serious social consequences – restricting patient access to affordable pharmaceuticals.
Several companies producing generic medicines challenged in court this contribution, invoking the unconstitutional character of the way in which the calculation base of the tax was defined: the tax is applied on medicine producers , but is calculated on shelf price, which includes the additions of pharmacies, distributors and the value of the VAT.