Faulty Policy at the Core of Pakistan’s Medicine Crisis

Since a few days, Pakistan has been hit with a sudden and acute shortage of 60 essential medicines – some of them life-saving.

Hospitals, especially the Out Patient Department (OPD) were already overburdened, but were now thrown into chaos as doctors struggled to attend to the stream of patients wheeling in with complaints.

Hospital pharmacies remained barren, leaving desperate patients to turn to private medical stores. And as per the law of supply and demand, where demand was at its peak and supply nearly non-existent, prices skyrocketed, ensuring that medicines effectively remained out of public reach.

By now, however, the situation seems to have normalized for some health units, according to Dr. Salman Haseeb, Chairman of the Young Doctors Association (YDA) Punjab.

“The local administrations of a select few hospitals have managed to acquire medicines,” he stated. “However, the central supply is still short.”

 

 

Services Hospital’s pharmacy is one of the select few that have restocked their supply, although through local suppliers – a temporary solution to a problem that, if not addressed immediately, can have dire consequences for the general public.

Unfortunately for the common person, the struggle to access basic medical care is not new.

Pakistan’s import to export ratio of medicinal and pharmaceutical products is severely skewed.

In 2018, Pakistan imported US$878.3 million in pharmaceutical goods while exporting only US$5,219.842 – following a general trend of consistently declining exports since 2011 (although 2018 saw a nominal increase from US$5,104.208 in 2017) and considerable increases in imports since 2015.

 

Export Value of Medicinal and Pharmaceutical Products

Export Value of Medicinal and Pharmaceutical Products

 

 

 

Import Value of Medicinal and Pharmaceutical Products

Import Value of Medicinal and Pharmaceutical Products

 

What these numbers mean is that Pakistan effectively does not have a pharmaceutical manufacturing industry, leaving the country highly dependent on imports to maintain its local supply of medicines. As such, even the smallest fluctuation in trade or economic policies on drugs can have devastating effects for Pakistan’s healthcare sector, and therefore its citizens.

The state has been struggling to form a sustainable policy on drug prices and distribution, raising and then cutting down manufacturing costs and market price in the hope that something might stick and have a desired impact.

 

 

A 2015 study on the impact of the Drug Regularity Authority of Pakistan (DRAP) posited that since its creation in June 2012, is has implemented “numerous excessive taxes and fees for provision of services… [accruing] as much as USD 4 million in 2 months” by extending the process of registering drugs, issuing manufacturing licenses and contract extensions, effectively rocketing manufacturing costs and, according to the Pakistan Pharmaceutical Manufacturers Association (PPMA), driving out MNCs from the country. The supply of medicines has since been in a constant state of flux.

In January 2019, DRAP had approved up to a 15% hike in the price of medicines across the country following a shortage in supply due to devaluation of the currency (making packaging and acquisition of raw material costlier than before), increased tax on gas and electricity, and low-cost drugs not being feasible for manufacturers to produce at reduced prices. For a country with a significant proportion of the population living below the poverty line, the decision was a hard blow. The situation immediately worsened when private pharmaceutical companies illegally hiked prices by 100% to 500% – an outcome that DRAP somehow did not account for when issuing its pricing policy.

 

 

In response, the government reversed the price hike within 5 months, with Special Assistant to the Prime Minister on National Health Services, Regulation and Coordination, Dr. Zafar Mirza, issuing special orders to pharmaceutical companies to ensure the availability of essential drugs in the market, which prior to price cut were still in short supply.

A couple of months later, in August 2019, the suspension of bilateral trade with India in response to its decision to revoke Article 370 of its Constitution cost the healthcare sector dearly – pharmaceutical products imported from India were 10 times cheaper than that of MNCs. The dramatic decrease in medicinal supplies and soaring prices prompted the government to lift the embargo on pharmaceutical goods the very next month. However, the shortage remained, with health facilities bereft of crucial medicines to operate basic and emergency services, while DRAP issued a seven percent annual price increase in October 2019 that added even more to the burdens of the populace.

 

 

In light of all this, it seems the recent critical shortage of essential medicines reported this month is not a new development, rather it is one part of a national crisis that has lasted since 2012. The disappearance of some 60 essential medicines this month was, however, unpredictable in the severity of its effect on the population and healthcare units. Basic medicinal products such as saline water seemed to have vanished from the face of the earth while caretakers and guardians of patients are currently being forced to either go home empty handed or to dole out hefty sums for exorbitantly priced medicines wherever they are still in supply.

To correct this, the government has renewed contracts with drug manufacturers which, per their claims, will ensure availability of medicinal products. But it will still be an arduous wait – from approval of contracts to procurement of the medicine, to packaging and then distribution, an estimated 45 days are required until medicines are finally available in the market. Until then, DRAP has once again issued a price hike in response to manufacturers forgoing production of low-cost medicines, one among the many factors that caused the recent shortage. However, given that state has consistently failed to find and address the gap between manufacturer concerns and public welfare in its policy, it seems highly likely that the drug crisis will find its resolution soon.

Until then, Pakistan’s citizens must bear with the state’s compromise of their health and lives.

 

Authored by Asra Haque and Xari Jalil

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