Imposition of 17pc ST: 10 life-saving drugs disappear from markets

  • PPMA chairman says due to imposition of ST, non-receipt of refunds and increase in production cost, raw materials could not be imported

LAHORE: The ongoing tussle between the federal government and Pakistan Pharmaceutical Manufacturers Association (PPMA) over imposition of sales tax has led to a shortage of 10 life-saving drugs in the market across the country, Pakistan Today learnt on Tuesday.

According to details the medicines including: Thyroxine, Paracetamol, Ceftriaxone, Cephradine, Cefixime, Aspirin, Amoxicillin, Co-Amoxiclav, Alprazolam and Bromazepam were not available in the market.

The well-placed sources in the Pharma sector informed this scribe that due to the imposition of 17 percent sales tax on pharmaceutical raw materials, the pharma industry has completely stopped import of raw materials.

They further said that if the government does not take the stakeholders into confidence in this regard, then in the next few days 80 percent of the drugs will be completely removed from the market.

They also informed that in a meeting chaired by Saleem Mandiwala on behalf of the government, Shaukat Tareen had expressed support for abolition of 17 percent sales tax from raw materials, meant for manufacturing of medicines.

When contacted Qazi Dilawar, Chairman, Pakistan Pharmaceutical Manufacturers Association (PPMA), informed that the imposition of 17 percent sales tax has resulted in 20 percent shortage of daily-use medicines, including life-saving medicines, across the country.

“At present, patients across the country are in a state of crisis as the pharmaceutical companies have run out of raw materials and if this situation continues, there will be a 50 per cent reduction in medicines from next month,” he said.

Dilawar further informed that PPMA has demanded immediate increase in prices of medicines from 20 percent to 25 percent from the government and this includes elimination of 17 percent sales tax on raw materials and refund of Rs 40 billion from Federal Board of Revenue (FBR).

“Our sector has been suffering from a severe crisis for the last 6 months but the government is constantly showing lack of seriousness. In this regard, sales tax was levied and promised to be refunded. Both the governments have so far collected our 40 billion refunds which the government is not ready to repay due to which we did not have any more resources to import raw materials. On the other hand, increase in prices of gas, electricity and petroleum products and labor costs have led to a 45 percent increase in production costs. About 95 percent of the raw materials for pharmaceuticals come from abroad and the tariff per container has increased from US $ 1,000 to $ 9,000,” he added.

He further added that prices of locally manufactured goods were increasing on a daily basis, contrary to the medicines prices, which are not being increased proportional to this hike.

“Pakistan’s pharmaceutical industry is not only exporting medicines but also meeting 90 percent of the country’s needs. If the industry is not taken into confidence, it is feared that Pakistan will have to import the medicines annually worth $8 to $10 billion, which will be 500 percent more expensive for the average patient than domestic medicines,” he pointed out.

Dilawar also warned that the PPMA would go on strike after June 22 if their demands are not met.

 

Shahab Omer
The writer is a member of the staff and can be reached on [email protected]

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