Pharma industry flashes warning lights | Sunday Observer
Medicinal drug shortage to worsen

Pharma industry flashes warning lights

6 March, 2022

The shortage of medicinal drugs will worsen leading to a major crisis in the country’s pharmaceutical industry said officials of the Sri Lanka Chamber of the Pharmaceutical Industry (SLCPI) at a media briefing convened last week to caution the country and  particularly law-makers of the impending crisis that would deny the lifeline for critically ill patients in the country.

Elaborating on the present status of the pharma industry, SLCP President Sanjiva Wijesekera said the industry will be in an appalling state within a couple of months as the scarcity of essential drugs becomes acute leaving hapless patients in the lurch.

“We cannot say what will happen in the future. All that we could say is we have medicinal stock for about two to three months,” said Wijesekere.

According to the pharma chamber, the industry needs around USD 25-30 million per month for the import of drugs.

The percentage of the shortage of essential drugs would rise due to the demand that cannot be met as the country faces a major foreign exchange crisis.

Pharmaceutical Chamber officials confirmed shortages in essential medicines and raised their deep concerns over supplies moving forward, including lifesaving drugs.

While the pharmaceutical industry has been affected by global issues such as logistics challenges, cost escalation of raw materials and inflation and Sri Lanka is not an exception to these challenges. Industry officials identified three key factors affecting the current shortage of essential medicines in Sri Lanka.

The pharmaceutical industry noted that they are currently unable to sustain supplies of essential medicines due to unrealistic price regulations set by the National Medicines Regulatory Authority (NMRA). All essential drugs are under price control since October 2016, without a pricing mechanism.

“A sustainable pricing mechanism will help adjust for key input costs changes such as the exchange rate, fuel costs, interest and inflation.

The NMRA has been requested by the court to establish a price mechanism that is sustainable both to the industry and the patient. This has not happened yet”, SLCPI noted.

The industry further noted that there is undue delay at the NMRA in 1) granting the re-registration of products which have been available in the market for a considerable period, and 2) new product registrations. With regulatory fees increasing by an average of 11-fold, the service of the regulator is below expectation.

“There is a severe delay in processing the documents for granting product registration approvals and import licences,” the SLCPI stated.

“Around 85% of the pharmaceutical products are imported, and these imports are paid for by US dollars. The current US dollar shortage in the country has increased the difficulty of importing essential medicines. In addition to this, companies have been unable to pay their dues. As a result, suppliers are no longer interested in supplying to Sri Lanka”, stressed SLCPI.

The situation is further worsened as banks find it difficult to honour the Letters of Credit (L/Cs) that are opened to import drugs. Bank delays in opening the L/Cs until there are sufficient dollars has resulted in shipments being scheduled according to the availability of dollars and not according to the needs of the patients, the industry stated.

“The well-being of our patients is our priority. During the pandemic, we demonstrated this by ensuring continuous supplies in trying circumstances. We are prepared to work with the government and engage with relevant stakeholders to secure Sri Lanka’s immediate requirements for medicines and prevent medicine shortages, but solutions to dollar shortages and more importantly acceptable pricing mechanism as well as immediately ironing out NMRA red tape for registrations are prerequisites,» SLCPI stated.

SLCPI serves as the representative of over 60 members who account for more than 80% of the private pharmaceutical industry, spanning manufacturers, importers, distributors and retailers. These stakeholders supply Sri Lankan patients with 1,200 molecules from 435 manufacturers across the world.