Medicine shortage feared as pharma industry faces ‘worst crisis’

Stakeholders warn govt's 'indifference' tantamount to 'distributing deaths'

Adnan Lodhi/Salman Siddiqui January 24, 2023
A man sells medicines at a medical store in Karachi. PHOTO: REUTERS


As the deteriorating economic crisis hits the health care system, the pharmaceutical industry is struggling to replenish its supplies amid a shortage of essential life-saving drugs and other surgical instruments, The Express Tribune learnt on Saturday.

Due to a number of critical factors, including refusal of commercial banks to issue new Letters of Credit (LCs) on account of a shortage of US dollars, the economic crisis has also not spared drug companies that are struggling to maintain stocks of essential life-saving drugs crucial to keep many alive.

With experts warning of economy sinking into near-paralysis, top pharmaceutical companies are scrambling to acquire raw materials to manufacture drugs while being forced to slash production as patients suffer in hospitals, sources said.

Faced with chronic shortages of medical equipment and anaesthetics, doctors at major hospitals are forced to stop performing surgeries.

The crisis comes as the country’s foreign exchange reserves drop to an eight-year low of $4.3 billion and talks with International Monetary Fund (IMF) hang in balance, raising alarms that the country might end up in bankruptcy.

As a result, the country cannot pay for basic imports like medicine and active pharmaceutical ingredients (API) for locally-produced medicines, several vaccines, immunoglobulins and biological products for the treatment of cancer and other diseases.

The operation theatres are left with less than a two-week stock of anaesthetics which is extremely important for performing highly sensitive surgeries, including heart, cancer, kidney and abdominal operations.

Besides, the pharmaceutical manufacturers are left with a raw material that will last only for four to five weeks.

The doctors are not able to continue uninterrupted treatment as medical supplies such as coronary stents, cannula, syringes and even gloves run low in facilities including Pakistan Kidney and Liver Institute & Research Centre, and several cardiology and cancer hospitals.

On the other hand, stakeholders of medical companies have urged Prime Minister Shehbaz Sharif and Finance Minister Ishaq Dar to immediately heed their concerns and demands, and advise the state bank as well as commercial banks to resolve their issues.

They warn the crisis may plunge into further severity as the raw materials required to manufacture various medicines have been held up at the Karachi port due to a shortage of dollars.

Thousands of shipping containers with essential food items, raw materials and medical equipment are stuck at the port in Karachi for weeks.

It may be noted here that the country experienced a similar scenario last year when economic woes left many pharmacy shelves bare. The companies had in vain urged for urgent solutions to the inventory crunch.

Currently, the drug companies are also understaffed due to the crisis while salaries are being slashed

It is pertinent to mention here that pharmaceutical companies import around 47 per cent of raw material from China, and 40 per cent from India in addition to Europe and other countries.

‘Distributing deaths’

"We are facing a number of issues but at the moment, the bigger problem at hand is that companies have paid payments and materials are at ports but banks are reluctant to release it, if at all,” said Hamid Raza, CEO of Neutro Pharma.

“We are also waiting as the procedure in banks is sluggish. The banks are giving excuses that they do not have dollars and that they have no instructions from the state bank,” he complained.

The ground reality is, Hamid continued, there was little or no raw material in the local companies.  “It is our demand that government should allocate money in dollars for the smooth running of the pharmaceutical industry and settle this issue,” he demanded.

Meanwhile, Drug Lawyers’ Forum Chairman Noor Mahar bemoaned that the government’s “cruel attitude towards the demands of the pharmaceutical companies” was tantamount to “distributing deaths”.

At the moment, he added, the companies were facing the issue of the non-availability of raw materials but pointed out that another pressing issue that needed attention was that around ten per cent of life-saving drugs imported from other countries were short.

 “People are dying due to the non-availability of medicines and surgical tools,” he added.

Govt urged for immediate solution

Pakistan's pharmaceutical industry had sounded alarm bells a couple of months ago to wake the government when it found itself with only three-month raw material to produce and supply medicines in the country following a virtual ban imposed on their imports.

But the government was still lingering in the planning phase, weighing its options on how to support the industry as the crisis continued to batter it.

However, the government’s long and slow reckoning appeared to have been an unwarranted delay as only a meagre amount of $150 million was needed to import the essential raw material and medical equipment, and steer clear of the crisis.

To recall, the government has allowed a couple of companies to make investments in foreign countries worth more than the amount required by pharmaceutical companies in the recent past.

The stakeholders have said the government must arrange the foreign exchange worth $150 million on a war footing basis.

Speaking to The Express Tribune, Pakistan Pharmaceutical Manufacturers' Association (PPMA) Central Chairman Syed Farooq Bukhari said, "We are in negotiation with the State Bank of Pakistan. They have assured us to facilitate the required imports."

He said the central bank has invited the pharmaceutical industry for finding possible solutions to the crisis next week starting January 23. "We have a meeting with SBP Governor Jameel Ahmad sometime next week. We will coordinate with the central bank on Monday to meet with the governor.

"We are working…we are hopeful that we will get some positive results from the meeting next week," he said. The government is taking the issue of shortage of raw material for pharmaceuticals seriously. "The government is also sensitive on the issue. It cannot afford such a crisis (in the making."

He said some 20-25% of pharmaceutical production stands sluggish at present. "The worst medicine crisis would erupt in the country if current policies (ban on imports) remain in place for the next four to five-week," he warned.

The pharmaceutical industry has been raising flags for the past couple of months. Accordingly, the government has taken some measures to support the industry to avert the crisis. The central bank issued a circular in the last week of December asking banks to prioritise imports by the pharmaceutical industry.

"The central bank has placed medicines on the top priority list of imports. Medicines have been placed along with the food (wheat), energy (oil and gas)," Bukhari said.

He said there were around 700 pharmaceutical firms in the country out of which over 650 manufacture medicines. The manufacturers include 12 foreign firms which were 16 in the first quarter (Jul-Sep) of the current fiscal year 2023.

Earlier while speaking at a press conference the other day, PPMA's central chairman said the government should treat drug manufacturers as an essential industry whose raw material should remain available throughout the year without its import being hampered due to the unavailability of dollars with the banks.

"Drug makers should continue with their production even during wartime as like any other essential service or industry."

He said if the crisis persists then the drug industry would be left with no choice but to resort to "downsizing" and ultimately halting drug manufacturing in the country.

Similarly, the import of essential surgical and medical equipment has been halted due to the prevailing economic crisis causing immense problems in the treatment of critically ill patients.

He urged the government to make sure that ample foreign exchange is made available to ensure the uninterrupted import of essential raw materials and surgical equipment.

"The Pakistani pharmaceutical industry has already undergone much trouble due to unnecessary checks on prices of medicines as it shouldn’t face anymore the current crisis caused due to unavailability of dollars. The government should adopt the emergency corrective measures."


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