Paracetamol: FBR refused duty waiver on raw material

DPC recommendations to stabilise prices not approved by cabinet


Zafar Bhutta February 17, 2023
PHOTO: FILE

ISLAMABAD:

The government has increased the price of paracetamol tablets after the Ministry of Finance and the Federal Board of Revenue (FBR) refused to grant subsidy and cut duties on the import of raw material.

Sources told The Express Tribune that the cabinet had directed the FBR to immediately exempt the import of active pharmaceutical ingredients (APIs) for paracetamol from all duties and taxes.

However, both the proposals of cutting the duty on raw material and granting subsidy to stabilise the prices of paracetamol were rejected, shifting the burden of increase in the prices to the consumers.

The Ministry of National Health Services, Regulations and Coordination (NHSRC) had informed the Economic Coordination Committee (ECC) of the cabinet that the Drug Pricing Committee (DPC) in its 50th meeting on January 12 last year had recommended an increase in MRPs of six drugs containing paracetamol and its combinations.

It was further said that the recommendations of the DPC were not approved by the cabinet in its meeting on August 16.

However, the cabinet in its meeting on September 13, while rejecting another summary to increase MRPs of 10 drugs directed the FBR to immediately exempt import of APIs for paracetamol from all duties and taxes.

A summary to solicit approval of exemption from customs duty was considered by the ECC in its meeting on September 21.

After deliberations, it was noted that exempting APIs from customs duty would discourage its local manufacturing and would not help resolve the issue of shortage of paracetamol tablets.

Therefore, it was considered appropriate to increase the MRP of paracetamol 500mg tablets by 80 paisa per tablet to Rs2.67 from its current approved MRP of Rs1.87 and to raise the MRP of paracetamol suspension/syrup by Rs12.18 per pack of 120 ml to Rs117 from its current approved MRP of Rs104.82.

The NHSRC ministry maintained that Prime Minister Shehbaz Sharif while chairing an online meeting to review the pace of flood relief and rehabilitation activities had directed that the provision of subsidy for three months may be worked out by the finance and NHSRC ministries to keep the prices of paracetamol stable in the market.

Accordingly, a summary dated September 23 was moved for the grant of subsidy to the manufacturers of paracetamol.

However, pursuant to a meeting in the finance ministry with the stakeholders, increase in the price of paracetamol products was agreed upon.

The cabinet, in line with the recommendations of the ECC, accorded its approval to partially increase the price of impacted paracetamol products in October.

The cabinet approved the proposal, which was notified by the Drug Regulatory Authority of Pakistan (Drap).

After the issuance of notification, the price of Paracetamol Plain (500mg) was increased from Rs1.87 to Rs2.35 and Paracetamol Extra (500mg) from Rs2.19 to Rs2.75.

Last week, the Ministry of National Health Services had requested the ECC to approve the remaining price increase to offset the rise in the rates of paracetamol raw materials along with the devaluation of rupee.

The price of Paracetamol Plain (500mg) was proposed to be increased to Rs2.67 and Paracetamol Extra (500mg) to Rs3.32.

The ECC considered the summary submitted by the NHSRC regarding "Proposal for increase in Maximum Retall Prices (MRPS) of Paracetamol Products" and approved the proposal.

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