The government has warned traders it is prepared to start importing medicines if the steep prices persist.

A price study carried out by the government since January has shown that around three quarters of the 208 medicines analysed were above the EU average. The rest, 55, were at a par or below EU average. The prices of another 250 products are still being worked out.

Parliamentary Secretary Chris Said told The Sunday Times: "These prices simply can't continue. We want to reach an agreement with the importers, but if we don't we're prepared to procure the medicines ourselves."

The Parliamentary Secretary responsible for consumers and fair competition is chairing a specifically set up committee to try to hammer out a deal with the stakeholders before the government takes remedial action.

There are some 80 medicine importers in Malta, trading in 3,500 medicines. It is believed, however, that the government buys an estimated 70 per cent of the value of medicines.

A government study three years ago had found that, on average, Maltese were paying 40 per cent more than their EU counterparts to acquire their medicinal products.

Despite various warnings given to importers by the Maltese authorities for several years, the situation has remained unchanged.

Back in 2006, the government had set up a working committee on the pricing of medicinal products to devise a system that would ensure fair medicine prices. Between 2007 and 2008, just 60 products were reduced in price - since the system agreed upon was voluntary.

"Despite some improvements, we're not satisfied with the results. In the next two to three meetings we have to decide what we're going to do," the parliamentary secretary said.

However, Dr Said added that during the last meeting importers said they would draw up their own proposals to bring down prices in time for the next meeting on June 25.

The exorbitant cost of medicinal products in Malta is down to various factors. Several traders argue that prices are hiked up from overseas because of the relatively low volumes imported.

The EU treaty makes it clear that member states are responsible for the organisation and delivery of health services and medical care.

The government is therefore free to set the prices of medicinal products, to influence these prices through national policies or to leave the regulation of prices to the market forces.

Dr Said said that a law to be debated in Parliament shortly to regulate consumers would incorporate medicines.