The cost of medicine

There has been an air of confusion regarding medicine and healthcare ever since the smart lockdown was initiated across the country. In April, it was reported that the pharmaceutical industry of Pakistan had lost 50% of its revenue during the two previous months owing to the spread of coronavirus pandemic in the country. Contrastingly, a report by Topline Securities indicated that pharmaceuticals witnessed a significant increase of 37% in profits during the first quarter of 2020.

Here’s the catch. Revenues do not equate to profit. And it is here that statistics can be manipulated or, in this case, portrayed in a way to lean towards a specific agenda. Thus, the harmonic balance of profit is achieved when companies gradually pass and disburse the impact of the loss, so that total profit is maintained. In the case of Pakistani pharmaceuticals, this was achieved through the increase in prices to pass on higher costs due to currency devaluation and inflation — with pharmaceutical companies losing revenue, the 300% increase in the price of raw material for medicines equals it out.

The government, on the other hand, has justified the stark decision of increasing prices of 94 life-saving drugs by up to 260% under the ‘hardship category’ as per the Drugs Pricing Policy of 2018 to end the shortages of several medicines in the market, since pharma would then refuse to produce them. However, one cannot ignore the fact that these pharmas contribute a substantial tax revenue to the government kitty, therefore, in both cases maintaining the profit balance is a win-win. But at what cost?

While the stakeholders remain busy in tipping the complex economic scale for their own selfish purposes, citizens remain crushed under poverty, ever-increasing inflation and lack of healthcare facilities. Furthermore, owing to severe pollution, climate change and social inequality, the living conditions of the people are deplorable to say the least. Diseases have become all the more rampant with patients, even those who are critical, forced to either reduce their daily dose of medicines or to discontinue the treatment altogether.

In such unprecedented circumstances the manufacturing of drugs, and healthcare in general, should not be thought of as a profit business. The concerned stakeholders need to realise that this is as much a humanitarian crisis as it is an economic one.

Published in The Express Tribune, November 1^st, 2020.

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