COSMETICS, drugs and toiletries are the fastest-growing retail categories in a weak consumer landscape, according to statistics released last week. Retailers of pharmaceuticals and medical products, cosmetics and toiletries rose 7.2%, according to Statistics South Africa. These sectors have been the best-performing categories throughout the consumer-spending downturn, said Nedcor Securities retail analyst Syd Vianello. He expects this trend to continue for the short-term. In stark contrast, retail sales fell 1.5% year on year in February - the 13th consecutive month of declines - indicating that consumer demand is taking longer to recover than forecast. Economists had predicted a slight up-tick in sales. Apart from the feel-good factor of cosmetics that enables customers to look and feel comfortable without having to spend extravagantly on fragrances, Vianello attributes growth in this category to high price inflation for drugs and rising membership fees of medical aids. He forecast a 12% improvement in 2010 sales of cosmetics, drugs and toiletries. Increased margins for drugs and rising sales of feel-good products are expected to be positive for personal care retailers such as health, beauty and pharmacy retailer Clicks, unlisted entity Dis-Chem, as well as large supermarket chains such as Shoprite. Shoprite has opened 101 MediRite pharmacies and continues to expand. It confirmed that personal care, toiletries and drugs are growing faster than groceries within Shoprite and Checkers. The biggest sellers are disposable nappies, sanitary ware and dental hygiene products. Clicks is well positioned for sales of drugs, personal care and toiletries and its buoyancy will be borne out this week when the group releases interim results. In a recent trading update, the group said headline earnings per share for the six months ending February would be 20%-25% higher than the previous comparable period. Clicks has dispensaries in 230 of its 360 stores and its stated ambition is to get to 500 stores, all with a dispensary and clinic. Mike Harvey, Clicks' managing director, said vitamins and supplements were the biggest growth areas. In personal care, the fastest-growing categories are face and skincare, soaps and dental products, and feminine protection. Unilever, the largest manufacturer of personal care products in SA, reported a 12.7% rise in toiletries from February last year to this year, while deodorants were up 11.4% over the same period.

Adele Shevel: The Business Times, 18 April 2010

FIRST quarter sales were up six percent to 12.2 billion Swiss francs (US$11.6 billion) for Roche Holding AG, with both its pharmaceutical and diagnostic divisions showing growth. The Swiss drugmaker's key cancer drugs, including the flagship Avastin, were seeing increased sales, and more medicines were meeting approval for US markets. Confirming the company's outlook for 2010, CEO Severin Schwan said Roche was off to a very good start in 2010. The results beat several analysts' expectations. The group was anticipating a decrease in sales of Tamiflu - the anti-influenza drug - from 3.2 to 1.2 billion Swiss francs. Until now the drug has helped drive sales, in part over surging demand during the swine flu outbreak. Roche also confirmed that it plans to introduce at least six new medicines by the end of 2014.

SAPA, 16 April 2010

THE Department of Health is planning to table legislation in parliament by September that will provide for a review of the powers and functions of the national and provincial health departments. Health Minister Aaron Motsoaledi said during his budget speech that the aim of the review was to harmonise provincial and national priorities.

Tamar Kahn: Business Day, 14 April 2010

PHARMACEUTICAL company Adcock Ingram has completed the acquisition of a 65,59% stake in a leading Ghanaian drugs company Ayrton. The acquisition was made through wholly-owned subsidiary, Adcock Ingram International. CEO Jonathan Louw said that following this acquisition, Adcock planned to launch a new portfolio of products into Ghana and West Africa. He said Ayrton had huge potential and its product range was similar to that produced in SA by Adcock so this was a perfect strategic fit for both businesses.

Business Day, 14 April 2010

HEALTH Minister Aaron Motsoaledi has told parliament that his department aims to reduce the country's maternal mortality ratio from the estimated 400- 625 deaths per100 000 to 100 or less per 100 000 live births over the next four years. This would be achieved through interventions, including increasing access to healthcare facilities, increasing percentages of maternity care facilities and by increasing the number of pregnant women who booked antenatal care early. He also said infant mortality had to decrease from the current 69 deaths a 1 000 live births to not more than 30-40 deaths a 1 000 live births. Motsoaledi said that healthcare sector would continue to ensure that children less than one year of age are fully vaccinated against pneumococcal infection and rotavirus. Other major initiatives that were hoped to reduce child mortality included increasing the number of eligible infants that received HIV/AIDS treatment, increasing nursing institutions that would give rise to integrated management of childhood illnesses and conducting health screening at poor schools. On the HIV/AIDS front, Motsoaledi said the disease remained a major contributor to the country's reduced life expectancy. He said the most important step taken by the government was to integrate the treatment of HIV/AIDS with that of tuberculosis. As part of expanding its antiretroviral (ARV) programme, the government had, since the beginning of April, added 519 public facilities to the existing 496 ARV centres across the country. Motsoaledi said the government had also decided that all of its 4 333 public health facilities should, over time, provide ARVs.

Sipokazi Maposa: The Cape Argus,

Press release by the Board of Healthcare Funders of Southern Africa in response to the HPCSA allegations of extortion by Medical Schemes

Fraud and wastage is an enormous problem for medical schemes and a conservative estimate is that as much as R7bn – R10bn of monies paid out annually by medical schemes are lost, due to fraud, abuse and over-servicing.

Fraud and abuse contributes significantly to the high cost of private healthcare and directly impacts on the pockets of the consumer. In terms of the Medical Schemes Act, medical schemes are legally obliged to act in the best interest of their members. This includes recouping monies that has been lost by members due to fraud, over-servicing and other wastage. There is clear legal precedence for medical schemes to recoup money owing to their members.

In order to ensure the sustainability of the industry, fraud needs to be dealt with decisively. The industry is not only under pressure from consumers to control the cost of healthcare, but also from government.

We strongly disagree with the HPCSA that wherever a settlement agreement is reached it amounts to extortion. We do not condone extortion or any illegal action by medical schemes, however we do not view mediation meetings and the recouping of member money as extortion as is purported by the HPCSA. We do not agree with the HPCSA that recouping of monies gained through fraudulent activities amount to prosecution. An example of this could be in a case of shoplifting - returning the item to the shop once the shoplifter has been caught, does not amount to prosecution.

One of the reasons The Board of Healthcare Funders’ Forensic Management Unit (FMU) was established, was to ensure that the investigation of fraud and abuse within the private healthcare sector, is conducted in an ethical, transparent and legal manner. All participants of the FMU are required to report matters to the relevant authority where there is a legal obligation to do so. The FMU will under no circumstances condone illegal or unethical conduct by any of its members, however, will strongly support and encourage its members to recover any monies lost due to fraud and abuse. It must be remembered that any monies lost by medical schemes due to fraud and abuse, in fact belong to the members contributing to those schemes and the trustees have an obligation to ensure that these monies are recovered as far as possible.

We support the HPCSA’s commitment to ensure that all practitioners registered under the Health Professions Act practice their professions ethically, professionally and with dignity. We also agree that any form of misconduct including fraudulent behaviour and/or over-servicing should not be tolerated.

It must be noted that the fines and other sanctions by the HPCSA do not mitigate the loss to the members of medical schemes. Therefore, medical schemes are still obliged to recoup the losses incurred by their members.

There have been many constructive discussions between the FMU and the HPCSA since the inception of the FMU, with support by the HPCSA for the policies and procedures developed for the industry. We are therefore surprised that the HPCSA has not contacted the FMU regarding their allegations. We appeal to the HPCSA to provide the FMU with actual cases of the alleged extortion so that a proper investigation may be conducted with the medical schemes in question.

Released by The Board of Healthcare Funders of Southern Africa
Contact: Heidi Kruger – Head of Corporate Communications, PCNS and FMU
Tel: 011 537 0237
Cell: 082 905 1161

PRESS RELEASE BY THE BOARD OF HEALTHCARE FUNDERS OF SOUTHERN AFRICA (BHF) On The Passing Of Dr Molefe Sefularo

Message of condolence from the private healthcare sector

The Chairman of BHF, Dr Mini, on behalf of the Directors and staff of the Board of Healthcare Funders of Southern Africa extends their deepest sympathy to the family of Dr Molefe Sefularo on their tragic loss.

The passing away of Dr Sefularo has come at a time when the South African healthcare system is on the brink of a positive and constructive overhaul.

His insight and wisdom which he shared with Directors of BHF and delegates at the BHF Conference in Sun City during August 2009 provided valuable guidance to the private healthcare industry on its role within the impending National Health System.

His intelligence and expertise will be greatly missed.

For further information, please contact Heidi Kruger on +27 11 5370237 or heidik@bhfglobal.com

PRESS RELEASE BY THE BOARD OF HEALTHCARE FUNDERS OF SOUTHERN AFRICA (BHF) On The Passing Of Dr Molefe Sefularo

Message of condolence from the private healthcare sector

The Chairman of BHF, Dr Mini, on behalf of the Directors and staff of the Board of Healthcare Funders of Southern Africa extends their deepest sympathy to the family of Dr Molefe Sefularo on their tragic loss.

The passing away of Dr Sefularo has come at a time when the South African healthcare system is on the brink of a positive and constructive overhaul.

His insight and wisdom which he shared with Directors of BHF and delegates at the BHF Conference in Sun City during August 2009 provided valuable guidance to the private healthcare industry on its role within the impending National Health System.

His intelligence and expertise will be greatly missed.

For further information, please contact Heidi Kruger on +27 11 5370237 or heidik@bhfglobal.com

DISPENSING doctors will save at least R8 million a year following a number of agreements with the Department of Health, another sign of improving relations between the government and the private healthcare sector. However, the saving will not be passed on to patients. Norman Mabasa, the chairman of the National Convention on Dispensing (NCD), said doctors would not pocket this saving, as it only meant they would reduce the loss of running their practices. The Department of Health has agreed to reduce the annual dispensing licensing fee by 75 percent to R200 a year. Doctors will also save on the advertising expense, which they incurred when they applied for a dispensing licence for the first time. They had to place advertisements 30 days before submitting their application for a dispensing licence, which cost an average of R400 per advertisement. The government has also given into the doctors' demand by changing the term of renewal from every two years to every five years. However, a dispensing cost of R2 400 a year, which is used to educate doctors on what they are not supposed to do when dispensing, is still in place. The NCD represents one segment of the private health care sector that has been at loggerheads with the Department of Health for a long time. In the past, doctors have taken the government to court over the dispensing fee, but the matter was eventually resolved out of court. Mabasa said doctors were still not entirely happy with the dispensing fee but were comfortable with the new arrangement as the fee would now be reviewed every year. The dispensing fee was first introduced in 2004.

Slindile Khanyile: Business Report, 7 April 2010

DISPENSING doctors will save at least R8 million a year following a number of agreements with the Department of Health, another sign of improving relations between the government and the private healthcare sector. However, the saving will not be passed on to patients. Norman Mabasa, the chairman of the National Convention on Dispensing (NCD), said doctors would not pocket this saving, as it only meant they would reduce the loss of running their practices. The Department of Health has agreed to reduce the annual dispensing licensing fee by 75 percent to R200 a year. Doctors will also save on the advertising expense, which they incurred when they applied for a dispensing licence for the first time. They had to place advertisements 30 days before submitting their application for a dispensing licence, which cost an average of R400 per advertisement. The government has also given into the doctors' demand by changing the term of renewal from every two years to every five years. However, a dispensing cost of R2 400 a year, which is used to educate doctors on what they are not supposed to do when dispensing, is still in place. The NCD represents one segment of the private health care sector that has been at loggerheads with the Department of Health for a long time. In the past, doctors have taken the government to court over the dispensing fee, but the matter was eventually resolved out of court. Mabasa said doctors were still not entirely happy with the dispensing fee but were comfortable with the new arrangement as the fee would now be reviewed every year. The dispensing fee was first introduced in 2004.

Slindile Khanyile: Business Report, 7 April 2010