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Drug Prices are again in news. The TV anchors are talking about it. There is a general sense of anger about the possible increase in drug prices in near future. This arises out of the policy that the drug prices shall be increased based on Consumer Price Index (CPI). CPI is a reflection of how the prices of selected basic commodities have changed over a designated period. The recent published CPI data shows that the prices increased by over 18% during fiscal year July 2019 – June 2020 as compared to last fiscal year. For your understanding this is huge and such massive increase is extremely uncommon. This is what we call inflation in everyday terms. The tragedy is that the cost of living has risen by over 18% but the incomes have not increased proportionately. In fact, the incomes have gone down considerably during the last quarter due to COVID19 Lockdown and the resulting job losses and business losses.
A renowned anchor gave precise details of the mechanism of drug prices increase as per CPI adjustment recently. However, he maintained that this policy was enacted by mischief and bad intention. Couple of days later, the federal government stood by the policy and announced that it will continue to be implemented, albeit with a little bit of change.
Being a Pharma Veteran, I would like to clarify on neutral grounds; not siding with my industry and not siding with my people.
Drug prices somehow attained the status of a ‘political issue’ several years ago. It is true that drugs are lifesaving, but drugs are not life-sustaining like the staple foods. The Prices of wheat, rice, vegetables, pulses, spices etc. have increased to alarming levels and there is a hue and cry every day, but no one lifts a finger to control. Electricity prices in Pakistan are ridiculously high; so is gas and fuel etc. The successive governments keep on inventing schemes to steal from its own public overtly and covertly and there is nothing the public can do. However, when it comes to drug prices, the government and opposition become oh-so sympathetic with the public. This is shedding crocodile tears at its best, and ultimate hypocrisy at its worst.
Drug Prices are strictly controlled in Pakistan since the beginning. The Ministry of Health used to be the organization for regulating and controlling all aspects of pharmaceutical business, including the prices. Later, a Drug Control Organization was developed within Ministry of Health for this purpose.
The DCO MoH comprised of career officers and staff who spent a lifetime in the health affairs. The speed of work was usually consistent and steady. There was a phase when the decision makers were more supportive for local Pharma industry and during that time the local industry prospered quickly. The cost of doing business was nominal, the fees charged by DCO was also nominal. Price increases were few and far between but there was no unrest at any level, neither in the industry nor among public.
During Musharraf period, there was a trend for making Authorities. The DCO was also made into DRAP, Drug Regulatory Authority Pakistan. DRAP mandate envisioned inducting highly qualified, highly paid executive on contract at key positions. In order to sustain the high cost of running DRAP, the fee structure was increased many times.
The first Chief Executive Officer of DRAP was selected after elaborate procedure. He came from Pharma Industry but did not know the working of a government organization. He treaded along bumpily, completed his tenure, and left without accomplishing much. DRAP was polarized and divided between low-paid career officers and highly paid contractual officers. The rift is still there.
The next CEO was fortunately from the career cadre. He speeded up the work but got embroiled in the controversial court case. Today, most key positions including that of CEO are being run by officers on Acting Charge basis. The paralysis which comes from insecurity of Acting Charge can be understood well.
The Minister of Health is not full minister; he is an unelected person. If you add up the pieces of picture, you will see the level of seriousness about public health and related matters. Truth is a rare commodity and outspokenness is now defined as ‘speaking out of context’ which simply means irrelevant. This is the situation of the organization which is supposed to regulate the entire drugs/ medical devices/ nutritional supplements business in Pakistan.
Drug Prices must be increased periodically because all the input costs are consistently going up, including the DRAP costs. It should be a dynamic process with rational and logical calculations. DRAP should own the industry that it regulates and should not join the group making it a punching bag.
The summary is that the proposed drug prices increase in not the real issue. It is a tiny fraction in the overall cost of living for any family. The real issues are extremely difficult living conditions due to skyrocketing prices and the complete inability of powers-to-be to exert control. We are desperate to get relief there.
May we see relief before long. Aameen.