GSKCH declares force majeure on Panadol production
PHOTO: FILE
GlaxoSmithKline Consumer Healthcare (GSKCH), one of the largest pharmaceuticals in Pakistan, on Friday, declared force majeure regarding the production of Panadol Tablets, Panadol Extra Tablets and Children’s Panadol Liquid Range, the company said in a filing to the Pakistan Stock Exchange (PSX).
“This is further to our several letters to various government stakeholders regarding the critical issue of extraordinary and rapid increase in paracetamol (raw material) prices in Pakistan,” says Farhan Muhammad Haroon, CEO and General Manager (GM) of GSKCH.
Force majeure is a clause in contracts that removes liability for unforeseeable and unavoidable catastrophes interrupting the expected course of events and preventing participants from fulfilling obligations.
The letter to PSX states that despite getting approval from the Drug Regulatory Authority of Pakistan (DRAP)’s for the 50th Drug Pricing Committee (DPC) recommended for the approval of the cabinet, “The same have been rejected after a prolonged delay by the latter without any intimation of reason(s).” It added that “although the company has received a routine Consumer Price Inflation (CPI) adjustment for the year 2022 from DRAP on August 25, 2022, the same is not commensurate with the debilitating increase in the prices of the raw material of Paracetamol.”
The letter urges the government to take urgent action “to rationalise the prices of the impacted Panadol range commensurate with the increase in the price of the impacted raw material.”
“We are one of the few multinational companies left operating in the country” Haroon highlighted, adding that despite incurring financial losses on the Panadol range GSKCH produced nearly 5,400 million tablets of Panadol 500mg and Panadol Extra in the last twelve months.
“Despite exhaustive efforts of the company to mitigate this matter through dialogue, the situation is now beyond our control. We are thus forced to declare force majeure regarding the production of Panadol Tablets, Panadol Extra Tablets and Children’s Panadol Liquid Range,” said Haroon in the PSX notification.
Published in The Express Tribune, October 22nd, 2022.
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