31 August 2004

Release Date: 2004/08/31

New Clicks Holdings is to appeal the Cape High Court’s judgment to dismiss its application to have the medicine pricing regulations overturned.

On Friday 27 August the court dismissed the application by New Clicks and others to overturn the medicine pricing regulations. The decision of the court was not unanimous, with Judge President John Hlophe and Judge James Yekiso ruling in favour of the Minister of Health and the chairperson of the Pricing Committee, and Deputy Judge President Jeanette Traverso handing down a dissenting judgment.

In her dissenting judgment, Judge Traverso ruled that the regulations were fatally flawed and should be set aside in their entirety, supporting the legal arguments of New Clicks and the other applicants on the invalidity of the single exit pricing mechanism, the appropriateness of the dispensing fee and other key aspects, as well as on the process followed by the Pricing Committee in making its recommendations to the Minister.

Group leader Trevor Honneysett said the dissenting judgment by Judge Traverso supported several of the key legal arguments raised by New Clicks and the other applicants, and “we believe this provides us with strong grounds for appeal. We will continue to follow all legal avenues to ensure that the regulations are revisited and ultimately implemented in a format which achieves savings all along the supply chain.”

“New Clicks has always supported the Government’s objectives outlined in the National Drug Policy of making medicine more affordable and more accessible, as well as improving the rendering of pharmacy services. We are also committed to achieving a sustainable and transparent pricing mechanism in line with successful international medicine pricing models.”

Honneysett said retail pharmacy plays an indispensable role in healthcare delivery in South Africa and its demise would ultimately be to the detriment and cost of the consumer. “We challenged the regulations in court owing to the severe risk that the regulations posed to the viability of pharmacies, many of which may face closure if the regulations are implemented in their current format.”

“We believe that it would be counterproductive for the regulations to be implemented until and unless they are passed on appeal. The parties had agreed in respect of the existing interim relief order that the regulations would not be implemented while the matter was before the court and this situation should still pertain pending an appeal,” said Honneysett.

Issued by Tier 1 Investor Relations on behalf of the Clicks Group
For further information kindly contact
Graeme Lillie, Tier 1 Investor Relations 021 702 3102 / 082 468 1507

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