Setting retail prices for medicines is a complex decision that involves balancing multiple factors; there is no single “best” method. Common strategies include: 1. Cost-plus pricing, which adds a fixed gross margin to your purchase cost. This approach is simple and straightforward, and ensures each transaction makes a profit, but may not maximise profits. 2. Market-oriented pricing, which takes as a reference the prices charged by your main competitors for the same medicine. This approach ensures that your prices are competitive, but if your costs are higher than theirs, it may result in slim margins or even losses. A mature pricing strategy generally combines the two approaches and adjusts prices according to different product characteristics, such as exclusivity and brand recognition.
HONG KONG DRUG LICENSING
How should I set retail prices for my medicines? Is cost-plus pricing better, or should I price with reference to the market?
A complete explanation of the regulatory basis, Drew Tang’s recommendations and risk alerts. The original material dates from 2025; read it alongside the latest official requirements.
Original guide, 2025 edition: These FAQs are provided for topic-based reference and have not all been individually checked against current rules. Please confirm fees, personnel, renewal, changes and product requirements against the professional in-depth guide for the relevant licence type and the official requirements in force at the time.
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