Friday,26 April, 2019
Current issue | Issue 1328, (19 - 25 January 2017)
Friday,26 April, 2019
Issue 1328, (19 - 25 January 2017)

Ahram Weekly

Pharmaceuticals prices set to rise

Egyptian consumers are bracing themselves for price increases of up to 50 per cent on medicines, writes Doaa Farid

Prices increases of up to 50 per cent on medicines
Prices increases of up to 50 per cent on medicines

Nabila Gaber, a 64-year-old Cairo housewife suffering from heart disease, last month stocked up on all her pharmaceutical needs for a couple of months after she heard news about potential price increases on medicines.

“If I hadn’t done so I would have regretted it later because I spend more than LE1,000 on medicines a month,” she said. That bill could now come to LE1,500 after the price hikes on pharmaceutical products announced earlier this week.

Pharmaceuticals join a long list of essential goods that have seen their prices increase following the floatation of the Egyptian pound in November. The prices of 3,010 medicinal products are set to increase following a Ministry of Health decision on 13 January that came on the back of demands by pharmaceutical companies to raise the prices of their products after the floatation caused higher production costs for most manufacturers.

The price hikes will affect 15 per cent of locally produced medicines and 20 per cent of imported medicines across different categories. Around 700 products designed to treat chronic conditions are also set to increase, something the government had previously said it would not agree to but has finally ceded to in order to avoid shortages.

Locally produced medicines priced between LE1 and LE50 are to increase by 50 per cent, while those priced between LE50 and LE100 will increase by 40 per cent. Medicines priced at more than LE100 will increase by 30 per cent.

For imported medicines, those priced between LE1 and LE50 will increase by 50 per cent, while those priced at more than LE50 will increase by 40 per cent, according to the Ministry of Health.

The increases will be applicable after the pharmaceutical producers start manufacturing and importers receiving medical shipments under the new conditions, Undersecretary at the Ministry of Health Rasha Zeyada said in a televised interview earlier this week.

The decision came after conflicting earlier statements. After the currency floatation in November, the minister of health said that the prices of pharmaceuticals would not increase. But pressure by manufactures strained by the depreciation of the pound eventually led to the new prices.

“The price increases were necessary as some pharmaceutical importers had halted their imports after the floatation to avoid losses,” head of the Pharmaceuticals Chamber at the Federation of Egyptian Chambers of Commerce (FEDCC) Ali Ouf told Al-Ahram Weekly.

“Moving prices up will guarantee that patients find the medicines they use on a constant basis,” he said, adding that the government also needed to improve access to medical insurance programmes to protect patients.

“If the dollar exchange rate goes above LE20 to the dollar, the companies will face the same problems again,” Ouf added.

Undersecretary of the Chamber Mohamed Ashraf also told the Weekly that the price increases were inevitable as “there was no other option to protect the pharmaceutical industry” in Egypt.

“We now want nothing else from the Health Ministry except for facilitating the procedures for registering new medicines,” Ashraf said.

The Pharmaceuticals Chamber at the Federation of Egyptian Industries also applauded the increases. Head of the Chamber Ahmed Al-Ezaby said in a televised interview earlier this week that pharmacies would adhere to the new prices, as these will be printed on the medical packages.

The Weekly spoke to 10 pharmacies in downtown Cairo this week, and they all confirmed their commitment to the new increases. “But we also want to increase the profit margin of pharmacies to 25 per cent,” Mamdouh Hafez, a pharmacist said.

Hafez’s demands were also voiced by the Pharmacists Syndicate, whose Secretary-General Ayman Osman told the media on Saturday that it had not been represented on the pricing committee formed by the Ministry of health to discuss price increases with the pharmaceutical manufacturers.

“We ask for the implementation of a ministerial decree issued in 2012 that promised pharmacists a profit margin of between 20 and 25 per cent,” Osman said.

Egypt’s pharmacists had threatened a partial strike on January 15 but postponed it upon a promise from the presidency to look into their demands.

The reactions of consumers to the price hikes have varied. Hossameddin Kamal, a 41-year-old engineer, said that medicine prices needed to increase “as this is a huge industry that needs to survive and continue supplying the market.”

He added that the prices of everything else had increased, “so why wouldn’t medicines?” However, he also called for salary increases to match the new prices.

The pharmaceutical manufactures are now required to continue supplying the market, as per their agreement with the Health Ministry which approved the price increases to avoid shortages.

The writer is a freelance journalist.

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