Manufacturers, traders blame each other

FE Team | Published: June 09, 2007 00:00:00 | Updated: February 01, 2018 00:00:00

Doulot Akter Mala
Prices of most life-saving drugs rose sharply over the past few days due to short supply in the local market.
Manufacturers claimed that prices increased because of price manipulation while traders blamed short supply by the manufacturers for the hike.
Abdur Rashid, a patient looking for insulin at the Mitford area, said: "I have to pay double the price for the life-saving drug, which I take twice a day."
Traders claimed that the supply shortage of the drug in the market pushed the prices higher.
Asifur Rahman, a salesman of Sabida Drug house at city's Islampur area, said prices of all types of medicine have increased, but the drugs produced by Beximco Pharma increased by 20 per cent in nearly two weeks due to disruption in supply chain.
While talking to the FE, secretary general of the Bangladesh Association of Pharmaceutical Industries (BAPI) Nazmul Hassan said: "We have no authority to increase the drug prices unless it is directed by the government."
Traders manipulated the prices of drugs following non-availability of the particular drugs, he said.
The supply of drugs of the Beximco Pharma suffered a setback due to supply shortfall of raw materials in the last month due to some problem in opening of letters of credit (L/Cs) and other technical complications, Hassan added.
"But, now the situation is under control and we are supplying drugs as per demand excepting a few because of rise in the prices of imported raw materials by three folds over a period of three months," said Hassan, who is also the chief executive officer of Beximco Pharma.
Expressing his worry over the government's reluctance to raise the price of drugs over the years, Hassan said: "We will not be able to produce some life-saving drugs like Methyl Ergometrin Meleate, Methyl dopa, Penicillin etc if the government does not immediately readjust the prices."
At least 3.0 per cent hike in prices of drugs might offset the losses of the drug manufacturers, he added.
Those life-saving drugs enter into the country through import or smuggling and consumers have to pay higher prices compared to the ones produced locally, which is undermining the government initiatives to keep the prices of essential drugs lower, he said.
"I think we will not be able to continue the production of penicillin due to mismatch in selling price and production cost," he added.
He said: "If the government readjusts the prices of medicine the local industries will be able to market those drugs at lower than imported ones.
In 1994, the government raised the prices of medicine by 3.0 per cent and according to the government's pricing policy the authorities are supposed to revise the prices of medicine in line with the government's estimated inflation rate and devaluation of taka.
In line with the directives of the 'current good manufacturing products' (CGMP) of the World health Organisation (WHO), the pharmaceuticals companies have to invest a large amount of money to upgrade their standard, he said.
During the last two years the drug industries are facing problems as they have to sell drugs at prices fixed 13 years ago, he added.
The government should provide incentives to those companies which are maintaining international quality standard, he added.
According to the Information Medical Statistics (IMS) of Switzerland, it was found that prices of 36 medicines reduced out of 120 medicines and only prices of five medicines slightly increased in 1994-2007 period.
"The drug manufacturers will stop production of those medicines unless the government immediately takes the decision of readjusting the prices of drug," he added.
He claimed that prices of drugs are much more reasonable than that of the neighbouring country.
"We are losing on sales of only 20 to 25 drugs out of a total of 4000, and we will continue production of such drugs even only at 1.0 per cent profit, for which a very marginal readjustment of prices is needed," he added.
He demanded a 10 to 12 per cent hike on those medicines, but for penicillin it should be 30 per cent.
Md Shihab, a representative of the Laaz Pharma at city's Kalabagan said: "Some essential drugs including insulin is now dearer in the market, which we have to sell at a higher price to the consumers,"
The government should issue more licences to import drugs to maintain of supplies, he said.
There is no competition among the drug importers, as a selective number of businessmen have import licences, he added.
Those imported medicines, which the country does not produce, will be available in the market at cheaper prices.
Recently, the National Board of Revenue (NBR) also sent a letter to the Drug Administration (DA) and pharmaceutical industries to increase drug prices.
The NBR requested the pharmaceuticals industries to send a revised price list to the DA to update the prices of drugs.
The board also warned that the government would withdraw the import duty waiver on ingredients of medicines if the drug industries failed to comply with the directives immediately.
The directives on the increasing the drug prices were given to pharmaceuticals industries from all eight excise and VAT commissionarates across the country in April and May to boost the revenue from value added tax (VAT), which is 15 per cent on factory rates (wholesale prices) of medicines.
The BAPI leaders sent a letter to the health and family welfare adviser for his intervention in the matter.
Besides, some 17-18 pharmaceutical companies are now exporting medicines to 68 countries.
The Tk 30 billion flourishing local pharmaceutical industries have been meeting about 97 per cent of the domestic demand.
Wholesaler and retailers claimed that higher cost of imported raw materials and drugs pushed the prices of medicine up during the last 15 days.
"Scarcity of supply of chemicals and non-availability of chemicals have pushed the prices of medicine up in recent times," said.