LAHORE - The increase in smuggling of different locally produced quality products including medicines is inflicting huge losses not only to national exchequer but also on poor patients who are unable to find cheaper locally produced medicines in local market.

Pharma manufacturers claimed that some essential drugs with low prices in Pakistan are being smuggled to neighboring countries like India, Sri Lanka and Bangladesh with the help of the customs and Khepias.

“Due to freeze on pricing since the last decade, it is the pharmaceutical sector and ultimate the general public that is suffering due to medicine shortages. Because of unreasonably low prices the much needed investment is not happening.

This situation will continue as when there is an imbalance between prices, the profit hoarders will seek to make a quick buck. The govt should take all stakeholders on board and build a consensus over future pricing and investment decisions with the pharmaceutical sector,” said Taha Siddqui, Head of research at Taurus securities.

Several commodities are at low price in local market, the grey economy finds it easily crossing the borders illegally when the price of same in neighboring country is higher and the margins are good enough to take risk, an industry official said.

‘The drug prices have been kept frozen by successive Govts since 2001 in Pakistan which is the reason some people find it quite much profitable to smuggle those drugs to neighboring countries like India. This is creating shortage of drugs and increases in patients suffer in consequence,’ said a top official of a pharmaceutical company.  

‘The criticism is always diverted towards the pharmaceutical companies for shortage of drugs which is not close to reality as it is the smuggling of drugs that is responsible for shortage,’ reasoned the official. In fact, he adds, people and government don’t realize that pharmaceutical companies are already manufacturing those drugs in limited quantity because they incur heavy losses on them due to their low prices. ‘The government does not consider harsh economic realities the companies are facing in Pakistan since long like high inflation, almost 100 percent devaluation of Pakistani rupee, massive increase in utility, transport, and labor rates etc.,’ added the official.

The official said that only solution to curb the smuggling is to make the drug price level at par with the neighboring countries the drugs are being smuggled to. ‘We don’t hear that drugs are smuggled to Pakistan from India. The reason is they have high prices of medicines as their government allow their local pharmaceutical companies to increase prices according to economic realities,’ added the official.