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Pharma companies threaten to stop production unless prices reviewed

February 07, 2023

KARACHI: Citing an unprecedented increase in cost of production due to massive rupee devaluation in Pakistan, several local pharmaceutical companies Monday said it had become completely unsustainable for them to manufacture medicines and ensure their availability beyond the next 7 days.

“Today, around 10 leading pharmaceutical companies have given separate notices to federal health ministry and Drug Regulatory Authority of Pakistan (DRAP) that they are going to stop production of medicines after a week if prices are not increased immediately. Cost of production of medicines has increased manifold due to massive rupee devaluation and increase in prices of utilities”, Qazi Mansoor Dilawar, a former Chairman of Pakistan Pharmaceutical Manufacturers Association (PPMA) told The News.

Referring to decisions taken at meeting of pharmaceutical companies on Sunday, which was attended by PPMA members from both South and North Zones, Qazi Mansoor Dilawar said due to increase in price of Active Pharmaceutical Ingredients (API) as well as packaging material, it was no more feasible for pharmaceutical companies to manufacture medicines and sell them on current prices.

He also shared a letter sent to DRAP and Federal Health Minister Abdul Qadir Patel by the pharmaceutical companies, in which they said the local pharmaceutical industry is heavily dependent on the import of raw materials. “Unfortunately, the pharmaceutical industry suffered a devastating blow as prices of the Active Pharmaceutical Ingredients increased exponentially in the international market since the outbreak of COVID-19 Pandemic”, the letter said adding that other factors of production like cost of fuel, electricity, freight charges and packing material also witnessed unprecedented increase during the same period.

The letter further states that Pakistani rupee devalued by more than 67 percent against the United States Dollar since July, 2020 but the local pharmaceutical industry played a responsible role during the Covid-19 pandemic, dengue fever crisis and public health crises emanating from massive flooding by ensuring uninterrupted availability of life saving medicines. The pharmaceutical industry repeatedly requested federal authorities and DRAP to allow inflationary adjustments in the maximum retail prices of medicines, it said.

Dilawar said both the federal government and the DRAP have failed to take any measures which has resulted in the collapse of the pharmaceutical industry.

This inaction has resulted in a force majeure being triggered in respect of the pharmaceutical industry’s obligations to ensure uninterrupted availability of medicines in the local market and to the public at large”, he said adding that in view of current situation, it has become completely unsustainable for the industry to manufacture medicines and ensure their availability beyond the next 7 days.

On the other hand, DRAP officials told The News that they had not received any letter from any pharmaceutical company till 4:00 pm on Monday regarding suspension of production.

“We have not received any letter from any pharmaceutical company regarding suspension of production by them. Actually, country’s economic situation is very bad and at this juncture, every person should act responsibly”, an official of the DRAP said.