Price of medicines will have a double readjustment in 2023 – 01/24/2023 – Market

The price of medicines is expected to rise twice in 2023 in 15 states that have raised ICMS rates or reference prices for applying this tax.

The change in local taxation will be added to the annual price adjustment authorized from April 1st for the entire country.

At the end of 2022, 12 states raised ICMS rates on various products, as a way to offset the cut in fuel and electricity tax. Medicines are among those items that will have an increase in the tax burden this year.

The new ICMS comes into force in March in seven states: Bahia, Piauí, Paraná, Pará, Sergipe, Amazonas and Roraima. The change takes effect from April 1st in another five: Acre, Alagoas, Maranhão, Rio Grande do Norte and Tocantins. Rates are currently at 17% or 18% in these locations. The new ones range from 19% to 22%, according to a survey by the company SimTax.

Two states made changes to the calculation base that are already in effect: Minas Gerais and Espírito Santo. In São Paulo, the new base takes effect on February 1st.

Sindusfarma (Union of the Pharmaceutical Products Industry) sent a letter to 12 Treasury departments to ask for the maintenance of the current ICMS rates on medicines.

It also requested that the government of São Paulo postpone the application of the new reference prices to March 1st, because of problems detected in the list with the change in the calculation basis. There are cases, according to the union, in which the published price is above the maximum amount that pharmacies can charge the final consumer.

The executive president of Sindusfarma, Nelson Mussolini, says that, in the 12 states where there was an increase in the rate, the change in the maximum prices set by the government is automatic. In São Paulo, Minas and Espírito Santo, the change in the calculation base does not change this limit, but it is possible that some companies reduce, for example, the discounts given to consumers.

“It’s a shot that the Treasury department is taking in the foot of the Health department. The person stops buying medicine, will get it for free from the state or, worse, will be hospitalized because they have lost control of a disease that needs daily treatment” , he says.

He says that Brazil’s tax burden on medicines should rise from 31% to 33%, well above the 6% of the world average.

Tatiana Scaranello, a lawyer specializing in Tax Law, says that the São Paulo list includes 8,270 medications. Of these, 4,465 had an increase in reference prices, the so-called PMPF (weighted average price for final consumers), for the application of ICMS tax substitution.

She gives as an example a generic of the antibiotic amoxicillin, whose PMPF rises from R$ 141.04 to R$ 296.30. With this, the ICMS installment in the state goes from R$ 16.92 to R$ 35.50.

“This year we will have two significant increases, because in addition to this issue of ICMS and PMPF, we also have the annual increase by the pharmaceutical industry, which is from April 1”, says the tax specialist.