Al-Ahram Weekly   Al-Ahram Weekly
13 - 19 April 2000
Issue No. 477
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In search of a cure

By Gamal Essam El-Din

Cartoon by Fathy MPs and local drug manufacturers joined forces this week to protest against Health Ministry policies governing the registration and pricing of drugs.

Galal Ghorab, chairman of the Holding Company for Drug Industries, accused the Health Ministry of adopting policies that have confused the entire market. The Health Ministry's laxity in supervising the registration and pricing of drugs, he said, has resulted in the "market being deluged by substandard drugs that not only negatively impact on the performance of public sector drug companies, but which are also dangerous to health."

Confusion over the registration of drugs - a result of inadequate supervision on the part of the Health Ministry - has resulted in several investment drug companies (mostly branches of multinational drug corporations) selling "food supplements" - primarily vitamins - at vastly inflated prices. Ghorab cited the spate of full-page advertisements in newspapers publicising "drugs" that are completely processed from natural ingredients. "In one case, the company claimed that the advertised 'drug' was effective against influenza. This is not a drug but a food product processed from vitamin C. More than 12 of these pretend drugs find their way into the market every day. The Health Ministry is also allowing multinational drug corporations to register drugs when substitutes are locally produced," complained Ghorab.

Ghorab also accused the Health Ministry of giving investment drug companies complete freedom in pricing products. For example - a drug produced by one of these corporations is sold on the market at, say, LE18, when its Egyptian equivalent, produced by a public sector company, is sold at LE2. "Public sector companies suffer from the government's insistence that they sell at a subsidised price. And at the same time the Health Ministry shies away from paying public sector drug companies LE350 million, which is the value of drugs purchased to cover the needs of the Health Insurance Sector," said Ghorab.

This mix of "irresponsible" policies, Ghorab believes, prevents public sector drug manufacturers from meeting domestic market needs. "All in all, 82 per cent of domestic market needs are currently covered by local drug manufacturers, down from 93 per cent five years ago, while the value of drug imports has increased from LE280 million to LE1.2 billion in the last ten years."

Many MPs agree with Ghorab that investment and multinational drug corporations are making astronomical profits in Egypt by charging local consumers inflated prices. Nor, they argue, do these companies redirect their profits into research.

Responding to the charges, officials at the Health Ministry insist that the campaign is largely inspired by "personal interests". Addressing the People's Assembly on Sunday, Health Minister Ismail Sallam also complained that the campaign is harming the reputation of the Egyptian drug industry in neighbouring countries.

"I would like to emphasise," he said, "that the Health Ministry exercises strong supervision over the production and registration of drugs on the local market. In 1998, 176 drugs were withdrawn from the market, while in 1999 the figure was 312. We have also closed down an unlicensed factory selling food supplements as drugs. Supervision and inspection are among the most effective in the world, even compared with America's Food and Drug Administration (FDA)."

The Health Ministry's policy on pricing, Sallam said, is designed to ensure that drugs are available at reasonable prices. The minister also defended the recent reduction in the price of an insulin-based drug, from LE13 to LE7 per treatment, on the grounds that it was now available to limited income consumers.

Sallam also defended his ministry's supply-side policies:

"In 1998, we suffered a shortage in as many as 273 kinds of drugs. All of these are now available at reasonable prices. Why is this fact being overlooked? Egyptian drugs are on average 40 per cent cheaper than their counterparts in other neighbouring markets, and this is to the credit of local industry."

Mahmoud Abul-Nasr, first undersecretary of the Ministry of Health, also entered the fray, pointing out that the ministry had approved price increases in the past twelve month for 216 drugs, 192 of them produced by public sector companies. "We are obviously keen," he said, "to help public sector companies to secure reasonable margins of profits."

Of 30,000 drugs inspected by the ministry last year, 176 were found to be substandard, proof that "the quality-control supervision of Egyptian drugs is exceptionally efficient," argued Abul-Nasr, who also added that Egyptian drug exports had increased doubled over the past four years.

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