Islamabad: Cash-strapped Pakistan is facing acute shortage of critical medicines after dispute over pricing between Pakistan’s pharmaceutical industry and the Health Ministry has forced patients to rely on smuggled and potentially counterfeit drugs at staggering costs.
The country is struggling with rising production costs owing to skyrocketing inflation and massive devaluation of the local currency in recent years, the industry demands a 38% increase, Anadolu agency reported.
The government, however, has rejected the demand, propelling pharmaceutical companies to either stop or go into a limited-scale production of scores of essential and non-essential medicines, it said.
The importers have reportedly stopped or drastically reduced the imports of about 100 crucial medicines related to general anesthesia, plasma-derived products, vaccines, oncology products, and biological products, causing a massive dearth of medicines across the country.
“Some of these medicines are either not being imported or are available in the market on a limited scale just because of the legal binding,” Abdul Samad, an office-bearer of the Pakistan Chemist and Drugs Association, told Anadolu, citing a government law that binds an importer to not completely stop importing medicine for which he has been granted a license.
“Most of the importers are nowadays importing a minimum quantity of dozens of essential and non-essential medicines just to keep their licenses intact. Otherwise, it’s no longer a profitable business for them due to a huge devaluation of the rupee against the dollar,” he said.
Samad cited the coronavirus pandemic and the Russia-Ukraine war as key reasons behind rising prices for products on the international market, primarily because of, and an unprecedented rise in global inflation
‘Worst is yet to come’
Pakistan has been burdened with increased cost of petrol and diesel with the price of all petroleum products has gone out of reach for common Pakistanis..
Increasing costs of fuel, electricity, freight charges, cold chain maintenance, packing material, and a cumulative 4% non-adjustable sales tax at the import stage, have “seriously” jeopardized the sustainability of the medicine business in Pakistan, Samad was quoted by Anadolu as saying.
Farooq Bukhari, chairman of the Pakistan Pharmaceutical Manufacturers Association, defended the demand for an “inflationary price adjustment,” which, according to him, is a must due to a dollar-rupee disparity and skyrocketing inflation, Anadolu reported.
“The (local) pharmaceutical industry is on the verge of collapse because of no corresponding adjustment in pricing despite a 60% increase in the materials’ cost in recent years, ” he told Anadolu.
Following the sharp depreciation in the rupee, Pakistan’s consumer price inflation jumped to 31.5% in February, its highest since June of 1974.
“When we demanded a 38% raise, a dollar was Rs235. And now it’s Rs286, which means even this 38% increase will not be enough,” said Bukhari. “However, we are still open to any government offer in this regard.”
If the government does not bow to the manufacturers’ “logical” demand, he warned, pharmaceutical companies would be compelled to shut down their units in the country, risking more than 1 million jobs.
“We have only one month (left) to take a decision as currently, we are using the raw material, which we have in the pipeline to produce medicines,” he said.
“Things will start going worse after one month if price adjustment demand is not met,” he said.
Accusing the government of Prime Minister Nawaz Sharif of “seeing this purely economic and logical issue through the prism of politics,” Bukhari said 1,300 local brands combined have communicated to the government that they cannot continue their businesses at the existing cost mechanism.
“There is a 200% increase in the prices of flour, oil, vegetables and other essential items. But the government is not ready to accept our legitimate demand just to gain political mileage,” he said.
Meanwhile, Pakistan’s ousted prime minister Imran Khan held a massive rally here on Sunday and presented his party’s 10-point roadmap for the cash-strapped country’s economic recovery, including sops for the diaspora.
Addressing the public rally at Minar-i-Pakistan in the early hours of Sunday, the Pakistan Tehreek-e-Insaf (PTI) chairman challenged the country’s ruling party to put forward a plan to rescue Pakistan from the many crises it finds itself mired in. “I challenge that the incumbent rulers don’t have the ability or the intention (to save the country),” he said.
Khan, 70, said he would happily step aside if the establishment tells him they have a plan. “I know what the programme is there is no programme,” he was quoted as saying by the Dawn newspaper.
Islamabad is reeling from an acute balance of payments crisis, desperately seeking to secure external financing, with foreign reserves falling to slightly more than $4 billion.