PPMA demands rationalization of drug prices to ensure availability of all essential drugs


Economic issues, problems should not be subjected to political decisions

PPMA demands rationalization of drug prices
to ensure availability of all essential drugs

At present Essential Drugs are available at only 4%
public hospitals and 25% private hospitals - SaeedAllawala

Realistic drug policy, incentives to invest in FDA quality
plants will help improve drug exports besides ensuring
growth and development of Pharma industry

KARACHI: The government should come up with a realistic drug policy with rationalization of drug prices which will ensure availability of all the essential drugs which can take care of almost 90% of the diseases. At present essential drugs are available at only4% of public hospitals and 25% of private healthcare facilities with the result that the patients are forced to buy more expensive substitutes. Economic issues, problems the PPMA opined, should not be subjected to political decisions but they need economic decisions to solve them. These views were expressed by Mr. Saeed Allahwala Chairman of Pakistan Pharmaceutical Manufacturers Association (PPMA) while addressing a press conference here on January 21st 2015. Others members of the PPMA who were present on this occasion included Mr. ZahidSaeed, Dr. Kaiser Waheed  Sheikh and Mr. Mohammad Zaka Chairman of the PPMA drug price committee.

Mr. Saeed Allawala Chairman PPMA (third from left) is addressing a
press conference regarding rationalization of drug prices. Sitting on
the dais along with him other members of PPMA from (L to R)
are Mr. Zaka, Dr. Sheikh Kaiser Waheed and Mr. Zahid Saeed.

Comparing the drug prices of a large number of branded drugs in India and Pakistan, Mr.SaeedAllawala showed that  61% of the top selling pharmaceutical brands  were cheaper  in Pakistan as compared to India  and Bangladesh but  only 39% of these top selling brands were a bit costly than India which was not a big issue.  It is a myth which is far from reality that drug prices are higher in Pakistan as compared to India and those who claim this are not aware of the actual facts. The public is also misled through the media with such statements that drug prices are higher in Pakistan as compared to the neighboringcountries which is totally false, he remarked. To prove his point, he presented list of many top selling brands with their prices in Pakistan, India and Bangladesh. (See Table I, II, III and IV).




After Textile, Pharmaceutical Mr.SaeedAllahwala said was the second biggest industry with which millions of people are affiliated in different forms hence it is essential for the government to take care of this industry. Government itself collects billions of rupees of taxes from the Pharma industry annually hence it was also in its own interest that the Pharma industry in Pakistan is provided an environment wherein it can progress and prosper. Mr. SaeedAllahwala in particular commended the government for preparing a drug policy which he opined, has many positive points particularly the linking of annual increase in drug prices as per CPI which if implemented in its true letter and spirit will go a long way in solving the problem of drug prices for all times to come without any complaint. PPMA urged the government to focus on four major initiatives to develop pharmaceutical sector. These included prices should be reformed and rationalized to support public health and industry performance, incentives be offered to invest in FDA-quality plants to gain access  to largest export markets. Contract manufacturing should be allowed without limitationand governmentshould set high and uniform quality bar which should be enforced. At present there are ninety certified FDA drug manufacturing plants in India, Italy has forty, China has twenty two, Taiwan has ten, Bangladesh has four and Jordan has three but unfortunately there is no FDA certified drug manufacturing facility in Pakistan.

PPMA Mr. SaeedAllahwala said was formed in 1961 and at present there are five hundred seventy five licensed drug manufacturers. There are three thousand registered molecules and the number of drugs available with different brands consisting of these three thousand molecules stands at about seventy five thousand. It has a 14% annual growth rate. Drug prices are fixed and controlled by the government and PPMA has some serious objections to the new drug policy which also has some very positive aspects. It is again a myth that Pharma industry was a very profitable industry which is evident from the fact that since the profitability has eroded;the number of multinational operating in Pakistan has reduced to twenty from thirty five a few years ago. Drug prices were given little increase in the Year 2001 and since then the prices were frozen. Over these years there has been manifold increase in the cost of all the essential utilities and other services i .e. electricity, fuel, transport, wages while devaluation of the Pakistani currency has also added to the miseries of the industry. If the industry has sustained so far it was because of the increase in market demand resulting in increased unit sales.

Speaking about the Essential Drugs, Mr. SaeedAllawala said that this list in Pakistan contains 318 drugs and this number varies in different countries as per their disease pattern. According to WHO these drugs should be 100% available at all the healthcare facilities as they can take care of almost 95% of the diseases which can be effectively treated with these medications. However, since their manufacture is not economical due to price control, most of them are not available forcing the patients to buy and doctors to prescribe expensive substitutes. The government is not willing to increase the price of an essential drug per tablet from rupees two to three but it has no problem with the availability of expensive substitute which costs twenty rupees per tablet. How one can justify such a step which is not at all in the interest of the patient at large. If a little price increase was allowed for these essential drugs their availability at affordable prices can be ensured without any interruption.  However, as pointed out earlier at present these essential drugs were available only 4% of public hospitals and 25% private healthcare facilities. This is contrary to the situation prevailing in most of the countries which is evident from the figures in the accompanying table which highlights the availability of essential drugs at public and private hospitals.( See Table-V)

After lot of persuasion the government of Pakistan, Mr. SaeedAllahwala said, agreed and issued an SRO in October 2013 allowing 15% increase in drug prices but later it was withdrawn. PPMA leadership urged the government to be realistic and instead of having a Price Reduction Policy, focus on a visionary policy which is helpful not only for the development and growth of the pharmaceutical industry but also ensures availability of essential drugs at affordable prices.  When conventional antimicrobial agents are not available which are cheaper due to price freeze, second and third generation cephalosporins are being used to treat various diseases which are much more expensive.

Mr. Mohammad Zaka pointed out that frequent changes in the Health Ministry and Drug Regulatory Authority of Pakistan was also responsible for the present state of affairs to some extent as no one can concentrate on these issues.  WHO says that all essential drugs should be available all the time but we have failed in this regard. Currently 15% of the population is served by public hospitals as regards drugs supply while 85% of the population buys the drugs from its own pocket. Since economically priced essential drugs are not available as they are not being manufactured due to freezing of their prices, patients have to pay more to buy expensive substitutes. Giving an example of anti TB drugs, Mr. Zaka said that tuberculosis is a major public health problem in Pakistan. Previously twenty five companies were producing these drugs but now only three companies are manufacturing anti-TB drugs. While on one hand the Pharma industry is not being provided any incentives, free import of finished drugs is allowed which was not in the national interest. Due to eroding profitability one of the multinationals marketing insulin has discontinued its supply and this is giving rise to monopoly which was not good in the long run because then those who have monopoly will dictate their own prices. Insulin is a life saving drug and those patients with diabetes who are on Insulin, have no other option but to take it.

Mr. ZahidSaeed also urged the government to allow reasonable price increase in essential drugs. The government should give up its policy of first creating a crisis and then solving the problem. Good governance means that they should foresee the problems and come up with effective practical solutions so that no crisis situation takes place. We have tried our best to convince the Government functionaries to come up with realistic drug policy taking into confidence all the stake holders but so far we have not succeeded. He made a passionate plea to the government to act before it is too late and make sure that all the orphan drugs which have no profits are available in the country. Responding to a question Mr. ZahidSaeed said that we fully support the government action against those who deal in spurious and substandard drugs. We in the Pharma industry suffer the most because of this. All the licensed drug manufacturers provide drugs to their distributors with warranty and they in turn provide these drugs to chemists with a warranty ensuring their quality. This supply chain is traceable and it is up to the provincial governments to ensure transparency in this supply chain. If some chemists are selling drugs without any warranty, it is unethical and they should be taken to task by the concerned authorities. We have no sympathy with these people, he remarked.

Mr. Saeed Allawala agreed that there may be a few in the pharmaceutical industry who are indulging in unethical marketing practices which eventually brings a  bad name to the entire pharmaceutical industry. He disclosed that the PPMA has now formed a committee to look into these issues and within next two months they intend to initiate some measures in this regard.Answering another question Mr. SaeedAllawala said that the pharmaceutical industry was witnessing 14% annual growth in its unit wise sales there was no addition to its value.

Dr. Kaiser Waheed Sheikh said the previous Nawaz Shareef Government had pursued a realistic drug policy with the result that it not only ensured the availability of drugs at affordable prices throughout the country even in the remotest villages and small town but also helped the Pharma industry to develop and grow. As a result the national pharmaceutical industry had made tremendous progress and is now capable of meeting most of the d drug needs of the country. Yet another major benefit of this policy was that it saved many precious lives and the life expectancy in Pakistan increased from fifty five years to sixty seven years.  Even during the earthquake it was the national pharmaceutical industry which donated drugs and medicines free of cost which was used at the healthcare facilities for almost two years. Pakistan at present has a pharmaceutical market of two hundred billion rupees and if the national pharmaceutical industry was not there, one can just imagine the amount of foreign exchange which will be required to import these drugs. Pharmaceutical industry, he further stated, is not a charity but we are in business and we do need reasonable profits for sustainability and running our business efficiently, he remarked.

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