Drug manufacturers say they will not invest because of clawback tax

Romanian drug manufacturers say they will have to stop investments this year and give up on unprofitable products due to the 30 percent increase in the clawback tax applicable to last year’s fourth quarter, as compared to the previous quarter, Mediafax notes. “In the fourth quarter, the clawback tax was 20 percent of sales reported by drug manufacturers, which means in addition to the 16 percent flat tax we have to pay 20 percent of the turnover. It all generates a 40 percent over-taxation,” Dragos Damian, president of the Association for Generic Medicine Producers (APMGR), stated yesterday. If investments are no longer carried out, the production capacity will not increase and unprofitable products will be taken out, in turn leading to fewer new jobs and an increased budget deficit, he said further. According to Damian, around 1,000 new drugs in all therapeutic areas have vanished from the market in the last three or four years, both due to the clawback tax and the method of calculation.
The head of APMGR noted that drug companies have won 120 lawsuits against the clawback tax in trial courts, and if the higher court also rules in their favor, CNAS will have to pay back the difference, resulting in a huge impact on the budget.
In turn, Calin Galaseanu, president of the Romanian Association of International Medicine Manufacturers (ARPIM), claims two in ten Romanian patients are treated thanks to contributions made by the drug manufacturers. He stressed pharmaceutical manufacturers have resigned to the tax, but the method of calculation remains problematic.

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