KUALA LUMPUR (June 24): Malaysia is looking to expand its sourcing options for pharmaceutical supplies from multiple countries in an effort to improve competition and lower medicine prices.
The move comes after the Public Accounts Committee flagged pricing distortions and limited competition in the pharmaceutical supply chain, which the bipartisan parliamentary body said have contributed to higher medicine costs for consumers.
“We are going outsourcing,” the then Health Ministry secretary general Datuk Seri Suriani Ahmad told the committee in a February 2025 proceeding, details of which were released on Wednesday. “We will not remain too dependent on what pharmaceutical companies dictate to us — that this is what you can buy, and only from us.”
Suriani has since been appointed as secretary general of the Rural and Regional Development Ministry in May this year.
In its latest report on rising health insurance premiums, private hospital charges and their impact on public healthcare, the committee raised concerns over pricing practices in the pharmaceutical supply chain, noting that high mark-ups at multiple levels of procurement.
Generic medicines supplied by hospitals were sometimes priced higher than branded innovator drugs, the report found.
The committee also highlighted limited competition in the market, noting that more than 1,500 medicines in Malaysia have only a single registered manufacturer, creating monopolistic conditions that allow suppliers to maintain elevated prices.
Suriani acknowledged cartel-like structures and monopoly practices in the drug supply chain, adding that Prime Minister Datuk Seri Anwar Ibrahim had repeatedly raised the issue of breaking such market dominance.
The Health Ministry was planning to expand procurement beyond traditional suppliers and explore outsourcing arrangements to secure more competitive pricing from India, China, Türkiye, Egypt, Thailand and Indonesia, where a broader range of generic medicines is available, she said.
However, she noted that the measure currently applies only to public hospitals, although the ministry is reviewing mechanisms to extend it to the private sector.
Resistance
In the same proceedings, Health Minister Datuk Seri Dr Dzulkefly Ahmad noted that proposals to extend bulk purchasing of medicines and medical supplies to the private sector have faced some resistance.
“We are not yet able to implement it together with the private sector,” he said. “It is easier said than done because sometimes, they see it as competition rather than synergy.”
Dzulkefly said the government would continue to push for broader participation from private healthcare players, describing it as the “way forward” to further reduce healthcare costs through coordinated procurement.
“We will still continue to push for strategic purchasing in the future,” he said.
The Health Ministry already coordinates strategic bulk purchasing with the Higher Education Ministry and the Armed Forces, allowing the government to leverage economies of scale to secure lower prices, Dzulkefly added.