Egypt addresses acute medicine shortage with imports, subsidies

Published November 17th, 2016 - 09:30 GMT
Since 1995, the Egyptian government has widely interfered in determining medicine prices through providing financial subsidies to the manufacturers. (Shutterstock)
Since 1995, the Egyptian government has widely interfered in determining medicine prices through providing financial subsidies to the manufacturers. (Shutterstock)

Medicines have been disappearing off Egypt's shelves for months, including a number of vital ones with no locally-manufactured alternative, sparking complaints from worried Egyptians. A source in the Pharmaceutical Industry Chamber told Daily News Egypt that the state conducted a deal with the chamber to import 154 different medicines for various ailments and their derivatives, with the state paying the difference in the value between the old and new exchange rate of the US dollar.

The medicines will be imported by a national company. This step, the source said, should ease the crisis of desperately needed medicines.

The chamber has previously warned of a real and unprecedented shortage in medicines all over Egypt.

This crisis came about as foreign currency reserves dropped to all-time lows, alongside the appreciation of the US dollar’s value against the Egyptian pound. Companies and factories that produced medicines were unable to procure the dollars necessary to import materials for manufacturing medicines.

An online campaign has taken off, encouraging people to donate surplus medicines by using hashtags on Twitter to spread the word. The campaign highlighted how patients with chronic illnesses or debilitating conditions hadn’t had regular access to their medication for months.

Since 1995, the Egyptian government has widely interfered in determining medicine prices through providing financial subsidies to the manufacturers. At the beginning of 2015, however, the manufacturing companies became unable to produce medicines on the old pricing system, so the government decided to raise the prices of all medicines that cost below EGP 30. The increase began at EGP 2-6, head of the parliamentary Health Committee Magdi Morshed told Daily News Egypt on Wednesday.

“At the beginning of 2015, there were shortages across 1,740 medicines due to the high cost of production. Manufacturing companies suspended their operations. Therefore, the government decided to raise medicine prices as a ‘temporary’ solution, but then the dollar crisis surfaced with the start of 2016,” Morshed said.

The dollar crisis and Egyptian pound’s devaluation are the main reasons for the shortage in medicines, as manufacturing companies were buying medicine components at the old dollar exchange rate of EGP 8.88, he said.

Some manufacturing companies decided to bear the cost and did not raise medicine prices, depending instead on the strategic stock of components; however, nowadays these companies are in dire need of state support as their components stock is almost spent, he added.

“Egypt produces nearly 8,000 types of medicines, including 1,740 vital medicines that are in high demand; however, the latter type of medicines are imported into Egypt. Due to the foreign currency shortage and financial support from the state remaining unchanged, these medicines will see price increases in the next few days,” MP Morshed warned.

The official ministry spokesperson was not available for comment on the ministry’s strategy, nor were any other ministry officials at the time of print.

The MP said that the crisis is now in the hands of the government. The parliament has been suggesting that the state issue several vital decisions, such as placing limits on manufacturing companies’ profits, facilitating these companies to expand in the industry, and lowering taxes on operating companies.

“Without immediate interference from the government, the medicine shortage will reach its peak in the upcoming weeks as the strategic component stock among medicine companies is almost spent,” he concluded.

The Medicine Manufacturing Chamber recently told Al-Ahram that production costs rose by 70% after the Egyptian pound’s devaluation, as the medicine sector imports 90% of the necessary components. Without immediate intervention from the government, 60% of medicine factories in Egypt will shut down.

In a phone interview to privately-run channel El-Assema on Tuesday evening, Doctors Syndicate secretary general Mona Mina stated that some hospitals issued instructions to doctors to use syringes multiple times due to the recent shortage in medicines.

Mina’s statements triggered massive controversy between social media users. This controversy pushed officials from the Health Ministry to pledge legal action against Mina’s statements after she was accused of issuing misleading information that caused confusion.

The Health Ministry is working to establish a factory of biodegradable syringes, according to assistant to the minister Ahmed Mohi. He questioned Mina’s statements and asserted that the ministry has a strategic stock of medical components that can cover hospital requirements for two years.

In response to Mina’s statements, the Ministry of Health and Population denied that it gave such orders, and vowed to take legal action against Mina. The ministry said that her statements aim to create panic among patients. It condemned the statements, citing the new syringes factory as proof.

It added that Egyptian hospitals have sufficient supplies of medical tools for two years, which are bought with the supervision of the armed forces

By Taha Sakr
 

© 2019 Daily News Egypt.

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