- State Min. requests price hike, NMRA approval pending: Pharma Chamber
- Chamber says 5% hike ‘grossly’ inadequate
- Warns 25% hike to ensure continued supply
BY Shenal Fernando
The decision on whether a 5% price hike will be instituted on pharmaceuticals is to be made today (10) by the pricing committee of the National Medicines Regulatory Authority (NMRA).
This was disclosed to The Morning Business yesterday (9) by Sri Lanka Chamber of the Pharmaceutical Industry (SLCPI) President Sanjiva Wijesekera, who stated: “The proposal was submitted today (9) for a 5% price hike in pharmaceuticals. This has to be reviewed by the pricing committee as well as the NMRA before the price increase is implemented.”
Explaining further, the President of the SLCPI stated that this proposal for a 5% price hike on pharmaceuticals was made by the Ministry of Health and the State Ministry of Production, Supply, and Regulation of Pharmaceuticals, and that as of now, only an acknowledgement of the request has been received.
He further stated that an answer to the proposal will be given tomorrow (11) by the pricing committee on whether or not the request for the price hike is approved.
However, speaking to The Morning Business, a source from the pharmaceutical industry stated that a 5% price hike is grossly inadequate following the 13.3% currency devaluation by the Central Bank of Sri Lanka (CBSL) on Tuesday (8) and claimed that such a 5% price hike was warranted prior to this recent currency devaluation.
Explaining further, he stated that prices of the price-controlled drugs were last adjusted by the NMRA in August of last year, when prices were increased by 9%. However, he claimed that the previous price adjustment was insufficient in comparison to the currency devaluation at the time.
Accordingly, he stated that a price hike on pharmaceuticals of at least 25% is necessary to ensure a steady supply of pharmaceuticals to the country.
Meanwhile, pharmaceutical manufacturers and importers have stopped supplying stocks to pharmacies after the recent devaluation of the rupee, according to media reports. As the majority of pharmaceuticals and ingredients to produce them are imported on credit, selling them at the current price would result in them incurring losses, which led to this move.
According to State Minister of Production, Supply, and Regulation of Pharmaceuticals Prof. Channa Jayasumana, prices of medicinal drugs will have to be revised based on the devaluation of the Sri Lankan rupee against the US dollar which took place yesterday.
The NMRA is taking necessary measures in this regard, he added.
Joining an event held last morning to declare open a “Rajya Osu Sala” outlet in Homagama, the State Minister noted that required steps have been taken to prevent the emergence of a medicinal drug shortage in the country.
In response to a question, he said: “One may predict that the stocks of pharmaceuticals available in the country are sufficient only for two to four weeks. However, we have taken measures to prevent such a situation. So, we urge the general public not to have any undue fears.”
In August 2021, the NMRA introduced a 9% price hike for 60 widely used pharmaceutical drugs which were fixed back in 2019. At the time they were fixed in 2019, the selling rate of a US dollar as fixed by the CBSL was Rs. 176 and it has increased to Rs. 203 currently, which represents a currency depreciation of 15.3%.
Therefore, the 9% increase in the prices of fixed pharmaceutical drugs in August of 2021 was clearly insufficient considering the fact that prices of pharmaceutical drugs and ingredients have also increased globally.
Following the 13.3% currency devaluation by the CBSL on Tuesday, the current selling rate of a US dollar is Rs. 230. Therefore, a 5% hike is clearly inadequate for the pharmaceutical industry, considering the cost of importing.
Over the last few months, the pharmaceutical industry has increasingly called on the Government of Sri Lanka to introduce a proper pricing mechanism in relation to price-controlled drugs, and currently, legal proceedings are being carried out in relation to it.
According to the pharmaceutical industry, if the regulator wants to implement a price control regime, then it must be paired with a pricing mechanism and should not be fixed arbitrarily.