Drug policy provides relief, still needs to fill void

Published: February 16, 2015
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“We think the new drug policy will soothe the nerves of the industry,” Pakistan Pharmaceutical Manufacturers Association (PPMA) Chairman Saeed Allahwala. PHOTO: REUTERS

“We think the new drug policy will soothe the nerves of the industry,” Pakistan Pharmaceutical Manufacturers Association (PPMA) Chairman Saeed Allahwala. PHOTO: REUTERS

KARACHI: 

The long-awaited drug policy has finally arrived, providing relief to the pharmaceutical industry. While a few speculate it will bring in new investment, there are others who are adamant on making further changes to regulate the sector.

The single biggest problem for the struggling industry has been the security issue, but it has been more disturbed in recent months due to the government’s demand to reduce drug prices.

Owing to the massive population, industry officials see a bright future for the pharmaceuticals. However, they continuously caution the government against hampering its growth through a restrictive mechanism.

“We think the new drug policy will soothe the nerves of the industry,” Pakistan Pharmaceutical Manufacturers Association (PPMA) Chairman Saeed Allahwala told The Express Tribune. “The price support mechanism will encourage local entities to invest in Pakistan without any fear and uncertainty.”

Pakistan meets about 80% of its demand from domestic drug production, including from multinationals, which operate in the country and have a market share of 44%.

The remaining 36% share is in the hands of local companies, according to industry estimates.

Pharmaceuticals, whether national or multinational, blame the unnecessary state control as the biggest hurdle to the industry’s growth.

There are 21 multinational companies that are manufacturing and marketing a wide range of research-based drugs.

Pharma Bureau, which represents the research-based multinational pharmaceutical companies operating in Pakistan, was also agitating against the government’s demand to reduce drug prices by up to 30%.

Despite endeavours, Pharma Bureau Chairman Shahab Rizvi was not available for comments.

Speaking on the grave regulatory challenges, Allahwala said that he does not agree with some of the officials of the sector, who suggest taking away pharmaceuticals from the health ministry and bringing them under the regulatory control of the Ministry of Industries.

“Even if you bring it under the watch of the Ministry of Industries, it will not get the attention it deserves from the government,” he said. “This industry needs proper attention according to its growth potential regardless of which ministry it comes under.”

The Drug Regulatory Authority of Pakistan (Drap) – an autonomous regulatory body tasked with dealing with the issues related to drug prices, licensing and inspecting the manufacturers – was established in November 2012 after the functions of the federal health ministry were transferred to the provinces in June 2011.

After a long delay of more than two years, the government has recently appointed the CEO of Drap from the private sector, but some industry officials believe the all-powerful bureaucracy will not let him work.

“Government officials are not accountable, and I am sure they will not let the new chief executive work for the growth of the industry,” said the CEO of one of the leading pharmaceutical firms, but requested anonymity.

“On the other hand, growing interference of parliamentary committees and law-enforcement agencies is discouraging government officials from taking new initiatives. Therefore, many health ministry officials prefer not to initiate anything that can land them in trouble.”

According to him, the future of pharmaceutical industry is not that bright. “When even the top 50 companies of a sector are reluctant to list themselves on the stock market, how can we say that the future of pharmaceuticals is bright?” he said, adding that companies are not going to the stock market out of fear, which is the result of unnecessary government control and short-sighted policies.

The writer is a staff correspondent

Published in The Express Tribune, February 16th,  2015.

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