(AFP Photo)
By Mostafa Fahmi
Domestic medical companies have seen the value of their medical sales increase 13% over the last two months, with the amount of available quantity having only increased 2% during the same period.
Domestic companies witnessed a 15% growth in the value of their medical sales in 2012, bringing in a total of EGP22.3bn in revenues. Productions units meanwhile only saw their rates increase 8% during this time.
Osama Rostum, member of the board of directors for the Pharmaceuticals and Appliances Chamber, stated that increases in the price of medicine, alongside decreases in growth in the amount of available quantities, suggests that cheap medicines have been withheld from the market and replaced with more expensive alternatives, while citizens are indirectly forced to bear the cost.
He stated that the Ministry of Health for the last 10 years has insisted on not increasing the price of medicine, causing companies to suffer huge losses. Lack of available quantity meanwhile often forces Egyptians to purchase expensive, imported medicines, which further hurts the sales of domestic companies.
That being said, Rostum said the desire to increase the price of medicine is a legitimate request on the part of domestic pharmaceutical companies. He added that the private sector could not afford to continue to subsidise the cost of medicine considering continued increases seen in the cost of production, including that of raw materials, dollar exchange rates, labour and essential goods. A source within the chamber stated that continued increases in medicine sales at a time of small profit margins could lead to economic disaster in the medium term.
In a statement given last week, the chamber stated that medicine production was the one sector not subsidised by the government. Despite this, however, the statement claimed that the government has continued to intervene in an “unjust way” in the pricing of new pharmaceutical products. The statement went on to say that prices had not been altered by more than 90% in the last ten years, despite continued increases in the cost of local goods involved in production. It went on to say that the chamber was under attack from a number of unspecified agents, saying that at the same time that a number of the government’s decision-making bodies remained largely ignorant of the plight of the industry.
Translated from Al Borsa newspaper
