KATHMANDU, JUNE 06
Following theCOVID-19pandemic last year, India, which is the global supplier of generic drugs, increased the price of raw materials.
It even restricted the supply of 26 pharmaceutical ingredients as well as finished products to Nepal, making it difficult for Nepali companies to supply essential medicines at their usual prices.
Since the drugs manufacturing companies cannot increase the prices on their own, the Association of Pharmaceutical Manufacturers Nepal had approached the Department of Drugs Administration (DDA) about the problems they were facing. When the price of the US dollar was Rs. 62, the prices of raw materials ranged between $2 and $3. But the price of the dollar has now risen to Rs.117 and the price of raw materials to $9. So the association proposed an increase of around 50 percent on the prices of essential medicines.
According to the DDA, medicines being an essential commodity, there is a price ceiling on it, but that doesn't mean their prices cannot be increased.
Although the DDA has considered the situation, the procedure to increase the price is lengthy, and this could result in a shortage of essential medicines in Nepal. In such a situation, the production of generic medicines could be the best solution to keep the prices of medicines low and also allow uninterrupted supply.
Generic medicine is similar in composition or quality to those medicines produced under a brand name. The difference between the two resembles the soft drink CocaCola that we have in a five-star hotel and the one that we drink in a local restaurant.
A point to ponder is that generic medicines don't carry a brand name. So there is no extra production cost on attractive packaging, edible colors and magnificent taste as inbrand medicines. Examples of generic medicines are paracetamol, ascorbic acid, dapagliflozin plus metformin and hydroxychloroquine.
The brand names of paracetamol are Cetophen and Cetamol.
So the production of generic medicines can be the only medium to adjust the price, which will be acceptable for both the producer and consumer. Due to the price ceiling on medicines, the price cannot be shared between the producer and consumer like other commodities.
So the best way is to reduce the import of unnecessary raw materials for making eye catching brands and replace the brand medicines with generic ones. If such an environment is created, we could even see a reduction in the price of medicines.
We can learn from India's Sun Pharmaceuticals, which is a billion-dollar company selling the cheapest generic medicines around the globe.
A version of this article appears in the print on June 7, 2021, of The Himalayan Times.