ISLAMABAD: As it sought up to a 60 per cent increase in the prices of drugs, the pharma industry has blamed the government for its failure to achieve self-sufficiency in the production of medicines.

“Because of lack of long-term policies, Pakistan has been exporting medicines worth only $200 million per annum and India has been exporting medicines worth $30 billion,” said Ayesha Tammy Haq, executive director of the Pharma Bureau, in a conversation with journalists.

She said Pakistan established the National Institute of Health (NIH) in the 1960s with the aim to produce vaccines for the entire region, but it failed to achieve its objective. India, on the other hand, has been meeting 60 per cent of the global requirement.

Ms Haq said that it was unfortunate that the government and the Drug Regulatory Authority of Pakistan (Drap) never focused on making the country “non-reliant on imports” of active pharmaceutical ingredients (APIs) – raw materials for medicine manufacturing – due to which country could not become self-sufficient in the production of medicine.

Industry seeks up to 60pc increase in medicine prices in light of inflation; says LCs worth $30,000 not being opened

“If the timely decision would have been taken and industry would have been facilitated, today Pakistan would have been exporting medicines worth at least $8 billion,” Ms Haq said. “We have been exporting medicines to some African countries and some Central Asian states. We should have many plants approved by the United States Food and Drug Administration [by now], but unfortunately, Drap has never taken appropriate steps,” she said, adding that it was never too late and the government could take measures to boost exports.

‘Prevent imminent catastrophe’

Ms Haq said the pharmaceutical industry of the country has sought immediate attention from the federal government to prevent imminent catastrophe. “Due to a massive increase in the price of raw material compounded by the continuous devaluation of the Pakistani Rupee and unprecedented inflationary trend, the companies are facing extreme difficulty in ensuring availability of drugs in the market,” she said, adding that the cost of production has posted a 60 per cent spike.

According to the executive director, no industry could grow if it’s compelled to sell its product at an unreasonable price fixed in the absence of a fair assessment of price. “Unfortunately, the pharmaceutical industry suffered a devastating blow as prices of the active pharmaceutical ingredients increased exponentially in the international market since the Covid-19 pandemic,” she said, adding that simultaneously, factors of production –the cost of fuel, electricity, packaging material, and freight charges— witnessed an unprecedented increase during the said period.

Giving a breakdown of costs, she said the packaging material for medicine also increased substantially, as one glass bottle’s cost was Rs5.67 in 2019 and now it is available at Rs10.45, with 84.30pc increase.

A carton was available at Rs54 in 2019 which now costs Rs 82 after an increase of 51.85pc, she said, adding that the prices of utilities also witnessed huge raise as the cost of one unit of electricity was Rs 14.96 in 2019 and today it is around Rs 41.33 – an increase of 176.27pc.

“The industry is also bearing the brunt of high freight cost, as per carton freight cost has gone up to 77pc from 2019 while the minimum wages also witnessed around 55pc increase since 2019,” she said.

Even though the government has allowed the import of vehicles worth billions of rupees, pharmaceutical companies cannot open LCs worth $30,000 to import raw materials required for the production of medicines.

Cost of APIs

Meanwhile, the Pharma Bureau has written a letter to Federal Minister Abdul Qadir Patel, stating that the prices of APIs have increased exponentially in the international markets since the outbreak of the coronavirus.

It stated that because of the attitude of government, a number of multinational companies have shut down their operations which has resulted in the withdrawal of foreign direct investment and unemployment at a large scale.

“We, therefore, call upon you to take this matter to the cabinet and ensure that the pharmaceutical industry is allowed an across-the-board price adjustment which will deal with the impact of devaluation and inflation. Today, that translates to a 60pc increase,” the letter stated.

Published in Dawn, February 12th, 2023