Supply chain woes blamed for high cost of rapid COVID-19 tests

Finbar O'MallonReporter

Dec 31, 2021 – 2.41pm

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Struggling global supply chains have been blamed for the rising costs of rapid COVID-19 tests.

Dean Whiting, chief executive of Pathology Technology Australia, a member group representing the bulk of rapid test providers, said the rising prices were reflective of struggles to get goods on limited air freight routes.

Demand for rapid COVID-19 testing is surging as people face long queues for tests at state-run clinics. Jessica Hromas

“It’s clearly up to each member to price accordingly, but what is a fact is that world supply chains are in an extremely challenging space at the moment,” Mr Whiting said.

“Sea freight you can almost forget about; getting airline space at the moment is extremely difficult.

“Prices for air freight have gone up about 500 per cent. If the prices are fluctuating from delivery to delivery, and it’s coming from my members, it will just be related to getting the products into Australia.”

The national cabinet has ignored calls to make rapid tests free. Prime Minister Scott Morrison claimed he had been pressured by industry.

Industry groups have contradicted Mr Morrison’s comments and claimed they have been pushing for the tests to be made freely available.

Pharmacy Guild of Australia national president Trent Twomey said the last three orders for rapid tests he had made for his pharmacy had increased in price each time.

Retailers and pharmacists should not be blamed for high prices when it was suppliers forcing them to raise the cost.

“I’m making the exact same margin,” Professor Twomey said.

“I understand the frustration that Australians would have when they see the prices fluctuating.”

When these concerns were put to Mr Whiting, he pointed to the supply chains.

He wants an inquiry into the cost of freight into Australia and hopes the federal government acts.

But he is concerned that with a possible change of government at the next federal election, any inquiry might be forgotten or delayed.

While Mr Morrison has suggested price gouging would be a matter for the Australian consumer watchdog, consumer law does not prevent retailers from charging higher prices unless they are considered “unconscionable” – like ramping up prices during disasters.

The Australian Competition and Consumer Commission was not available for comment.

NSW Fair Trading said it had received 22 complaints regarding prices for rapid tests in December.

Private sellers can charge whatever they like for goods in private sales.

Finbar O'Mallon is a reporter for The Australian Financial Review. Connect with Finbar on Twitter. Email Finbar at f.omallon@afr.com.au