Question & AnswerQ&A (DOH ADMINISTRATIVE ORDER NO. 2014-0001)
The purpose of DOH Administrative Order No. 2014-0001 is to provide implementing guidelines on the price freeze of medicines during disasters and emergencies in order to stabilize prices, ensure affordability, and protect consumers from profiteering and undue price increases.
Republic Act No. 7581, also known as the Price Act, mandates the price stabilization of basic necessities and prime commodities during emergency situations and like occasions.
The Department of Health (DOH) is mandated to monitor and regulate the prices of essential medicines during emergencies.
Price freeze refers to the situation in which prices or the price of a particular product are fixed at the prevailing level and no increase is allowed during the state of calamity or emergency.
The price freeze can be implemented for the duration of the emergency but not for more than sixty (60) days unless lifted sooner by the President.
The Drug Price Reference Index (DPRI) is the ceiling price for government bidding and procurement set by the DOH for all government agencies based on prevailing tender prices of essential medicines in government hospitals.
All public and private drug retail outlets including hospital pharmacies nationwide must comply with the price freeze or maximum ceiling price on essential medicines during emergencies.
Non-compliance with the price freeze guidelines will result in sanctions and penalties as stated in Section 16 of Republic Act No. 7581.
The Price Coordinating Council is an authorized body composed of government agencies headed by the Department of Trade and Industry that recommends necessary price ceilings and monitors price stabilization measures as provided under the Price Act.
The Order covers essential medicines classified as basic necessities by the Department of Health as well as non-essential medicines classified as prime commodities.
Government entities procuring essential medicines during emergencies are required not to exceed the Drug Price Reference Index (DPRI) set by the DOH and to follow it as the ceiling price for all modes of procurement.
The DOH disseminates or publishes the price lists of medicines during emergencies through various means including print, radio, television, and web-based postings.
Prevailing price means the average price at which any basic necessity has been sold in a given area within a month from the occurrence of any conditions enumerated under Section 6 of Republic Act No. 7581.
A disaster is any emergency resulting in serious disruption of the functioning of a community or society involving widespread human, material, economic or environmental losses and impacts that exceed the ability of the affected community or society to cope using its own resources.
Section 6 of RA 7581 mandates the automatic price control and freeze of prices of basic necessities during a declared state of disaster or calamity, which is the basis for the price freeze provisions in this Order.