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Hungarian Egis says new law may cut profit by Ft 3-8 bln

Hungarian drug producer Egis estimates that a recent law on drug subsidies may cut its profit by Ft 3 billion to Ft 8 billion, its CEO told Világgazdaság on Wednesday.

The new law will require drug producers to pay back 12% of their turnover on state-subsidised drugs into the budget, pay a Ft 5 million annual fee per sales agent and pay for more than half of any subsidy spending overshoot in the budget. Egis CEO Péterné Gál told that the new law posed a threat to innovation within the domestic pharmaceutical industry. Gál told the paper that, as a first step, Egis had reviewed its product portfolio and decided to take out products that would no longer be economical due to a rise in costs. This may affect about 10% of Egis's portfolio, which contains 1,650 products. (