Big price cuts for Covid-19 tests in South Africa
The Competition Commission of South Africa has announced it has reached an agreement with two of the largest pathology laboratories in South Africa to significantly drop the price of Covid-19 polymerase chain reaction (PCR) tests.
Competition Commissioner Tembinkosi Bonakele said that Ampath and Lancet Laboratories have agreed to reduce test prices to “no more than R500”. The new pricing takes effect immediately.
Bonakele said an investigation by the Competition Tribunal found that the cost of performing the tests had reduced on average, while prices remained the same for an extended period. This had increased the laboratories’ absolute margins.
Bonakele explained that the Covid-19 block exemption on the healthcare sector, which exempted pathologists and laboratories from competition laws to help promote a concerted effort to fight the Covid-19 pandemic, had helped enable the practice.
The other big lab in the country, Pathcare, was not included in the announcement. Bonakele said that the Commission expected the lab to come forward and resolve the matter, and that litigation against it was still ongoing.
He called upon other smaller laboratories still charging around R1,000 per test to comply with the settlement, even if they were not part of the agreement. The reduction comes after the Council for Medical Schemes (CMS) complained to the Commission in October over the prices of PCR tests.
Most labs have charged around R850 for the test since the start of the pandemic, and it is often required for travelling across borders or attending certain high-risk events. In response to questions in Parliament earlier in December, health minister Joe Phaahla said his department was also questioning the pricing.
“The department has no idea why the test for Covid-19 still costs R850 per unit despite the volumes, scale and technological advances in this area. The CMS has formally lodged a complaint in this regard [with] the Competition Commission.
Progressive Health Forum convenor Aslam Dasoo told Newzroom Afrika that the R850 or more private labs charged for Covid–19 PCR tests was not justifiable.
“That amount, at over R850 for 10 million tests [or thereabouts] comes to roughly R8 billion to R10 billion of income in these last two years just to the three main labs,” he stated. That is a huge income, and I’m certain that the profit margin on it is not justifiable — [not] at this point, certainly
Source: IOL
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