Caretaker govt allows drug firms to set prices independently

ISLAMABAD: The Ministry of National Health Services, Regulations, and Coordination on Monday allowed pharmaceutical companies to sell medicines that are not on the National List of Essential Medicines (NEML) at prices fixed by themselves, following a decision made by the caretaker federal government earlier this month.

“In exercise of the powers conferred by Section 36 of the Drugs Act, 1976 (XXXI of 1976), the Federal Government, believing that the public interest so requires, is pleased to exempt all drugs and biologicals not included in the National Essential Medicines List (NEML) from the operation of Section 12 of the said Act,” a notification issued by the National Health Services, Regulations, and Coordination (NHS, R&C) said on Monday.

Section 12 of the Drugs Act 1976 empowers the federal authorities to fix the maximum price at which any drug specified in the notification is to be sold and specify a certain percentage of the profits of drug manufacturers to be utilised for research in drugs according to the rules.

Following the issuance of the ‘ambiguous notification,’ the federal health ministry has allowed pharmaceutical companies to set the prices of medicines, both produced locally and those imported in finished form, on their own.

Officials in the federal health ministry claimed that only the prices of essential medicines, which are not more than 400, including some essential psychotropic drugs, antibiotics, and others, would be controlled by the Drug Regulatory Authority of Pakistan (DRAP).

A significant increase in the prices of thousands of medicines, including newly-developed antibiotics, cancer medicines, and drugs for the treatment of diabetes, hypertension, and many other diseases, is feared following the decision taken by the caretaker government, which is not supposed to make policy decisions, according to experts and officials.

They said there are hardly 400 molecules in the National Essential Medicines List (NEML) whose prices would now be controlled by the authorities, while the prices of thousands of medicines, including newly developed molecules for diabetes, hypertension, cardiovascular disease, psychiatric illnesses, neurology, gastroenterology, orthopaedics, and paediatrics, would be determined by the companies themselves.

Most of the drugs Pakistan requires are manufactured locally by pharmaceutical companies with imported Active Pharmaceutical Ingredients (API) and excipients, but most of the newly developed drugs, including biological products for the treatment of cancer and other health conditions, including insulin, are imported from abroad.

Experts fear that following the issuance of the latest notification, prices of thousands of medicines, except those on the ‘National List of Essential Medicines (NEML),’ are likely to increase significantly in the days ahead following the decision by the caretaker government to deregulate drug prices in the country.

The caretaker government is facing severe criticism for ‘irrational decisions’ regarding medicine prices after approving proposals to deregulate the prices of medicines not included in the National List of Essential Medicines (NEML).

“The caretaker government, on its way out, had made two irrational decisions regarding the pharmaceutical sector. First, it prohibited doctors and surgeons from prescribing vitamins, minerals, and food supplements, and secondly, it decided to deregulate the prices of medicines, which will cause an inflationary storm in Pakistan,” said Ayaz Kiani, a senior pharmacist and rights activist, commenting on the government’s decision.

Kiani, who is assisting the authorities in preparing the country’s National Medicine Policy, said that while medicine price deregulation has some benefits, in a country like Pakistan, it will result in a significant increase in medicine prices as well as over-prescription of drugs due to the prevailing pharma-physician nexus.

“In 1993, the then federal government had deregulated medicine prices, which was such a disastrous decision that it had resulted in a massive increase in medicine prices and made them unaffordable for most people. In those days, pharmaceutical companies were increasing medicine prices weekly or even daily without any oversight,” he claimed.

According to him, the major beneficiaries of the price deregulation of 1993 were the 150 or so local manufacturing companies of pharmaceutical products, which made hundreds of millions of rupees in a short time, adding that deregulating medicine prices will result in a significant increase in their prices, burdening millions of people living below the poverty line in Pakistan.

Urging the caretaker government to leave such an important policy decision to the next elected government, Ayaz Kiani said the authorities should take steps to ensure the availability of all required medicines, noting that even the pharmaceutical industry had not demanded the luxury of price deregulation granted to them by the present caretaker regime.

The Pakistan Pharmaceutical Manufacturers Association (PPMA) and Pharma Bureau, which represent multinational pharmaceutical companies in Pakistan, expressed deep appreciation for the federal cabinet’s decision to deregulate the prices of medicines not included in the essential medicines list based on the World Health Organisation’s (WHO) model list.

They said this important step, following international best practices and successful global pharmaceutical models, would usher in a new era, ensuring the availability of quality medicines at competitive prices and building the foundations of an export-focused pharmaceutical sector.