Ukraine. Determination of Prices for Medicines and Medical Products with Consideration of Mark-ups and VAT

On 10 April 2014 the Ministry of Economic Development and Trade of Ukraine (the “Ministry of Economics”) published Letter No. 321-08/11000-12 “On the Process of calculation of Prices for Medicines and Medical Products taking into account VAT and existing mark-ups” (“Letter No.321- 08/11000-12”).



In Letter No.321-08/11000-12 the Ministry of Economics states that the marginal wholesale mark-up should be accrued by a supplier (seller) on the amount of contractual price of the medicines including VAT.

According to the information from mass media, several days later, the Ministry of Economics issued another letter at the request of LLC “Morion” which specified that 7% VAT should be added to the taxation base which is determined as the contractual price of medicines that includes the marginal (wholesale) mark-up to purchase price.

This letter is currently unavailable in the official sources of information (regulatory data-bases) which leaves room for ambiguity in the computation of prices for medicines with consideration of VAT and mark-ups.

Source: KPMG-Ukraine