HomeLocal NewsPharmaceutical companies time bomb ticking

Pharmaceutical companies time bomb ticking

STILL smarting from the disastrous effects of a crippling strike by public hospital doctors, Zimbabwe now faces another major health catastrophe after it emerged this week that pharmaceutical companies could be forced to close as they have completely run out of foreign currency to import medicines and raw materials.


The Zimbabwe Independent understands that the Reserve Bank of Zimbabwe (RBZ) has failed to allocate foreign currency to the industry over the past three months and pharmaceutical companies are now cumulatively owed US$52 million.

Pharmaceutical companies require US$4 million per week to import drugs.

The situation has affected manufacturers, who import substantial amounts of raw materials, as well as wholesalers and retailers who import up to 90% of the country’s drugs, hospital consumables and equipment at a total annual cost of US$400 million.

It also emerged that the central bank is sitting on $6,5 million worth of letters of credit, which were allocated to the sector in October last year but were never actualised.

A letter of credit, also known as a documentary credit or bankers’ commercial credit, is a payment mechanism used in international trade to provide an economic guarantee from a creditworthy bank to an exporter of goods.

The arrangement means that companies will procure raw materials from foreign suppliers on credit on the strength of the letters of credit which the Reserve Bank of Zimbabwe (RBZ) has guaranteed.

Pharmaceutical Society of Zimbabwe (PSZ) president Portifa Mwendera confirmed the developments this week, saying the industry last received a foreign currency allocation in October.

“Since last year, actually since the 23rd of October, we have not received anything from the central bank. So from November, December and January, pharmacies have had find their own means to restock. The RBZ stance is that medicines are a priority but nothing has been allocated.

They are still sitting on a US$6,5 million credit facility they had said they had given us, and it has not been actualised,” Mwendera said.

“What we have in pharmacies now has been imported by individual pharmacies and it is expensive for them to import smaller quantities. The prices then become varied and might be more expensive. And that is why sometimes you see that people have to go through four or five pharmacies to buy medicines on one prescription. It is because of the shortages that are there,” he said, adding that successive attempts to engage the central bank have yielded no result.

“We have been asking for a stakeholders’ meeting with the RBZ and the Health ministry but it seems the RBZ has nothing to bring to the table so far and we have not met. So we are meeting with the ministry every Thursday to discuss what we should prioritise when we do get the money and we have established a committee to look into that, but what we are discussing now is just on paper.”

RBZ governor John Mangundya said he would be checking on the status of allocations with the committee established to look at the priority list.

“You can send your questions through and I will check with the committee and get back to you,” he said.

However, he did not respond to the questions.

A survey by the Independent revealed pharmacies have been increasing prices of medication by over 100% in United States dollars, forcing many patients to buy medicines outside the country, mainly from Zambia and South Africa.

For instance, the price of a simple 12 milliliter nasal spray (fluticasone propinate) jumped from around US$5 to US$12 or $44 (bond note) over the past three months while the same costs 92 rand in South Africa, the equivalent of US$6,50.

Other life-saving medicines that have become costly are high blood pressure treatments such as indapamide which used to cost around US$16 but is now selling at US$46 or three times that in bond note.

On the other hand, a dosage of exforge, again for high blood pressure, that used to cost around US$6, is now US$24.

The price of insulin, used to lower blood-sugar levels by diabetics, has also sharply increased over the same period.

An inquiry with some retailers in Harare indicated that, for instance, lantus, which used to cost US$21 as of September, is now selling for US$46 per unit while novo rapid now costs US$26, up from US$12.

These medicines, without which diabetes is highly fatal, are also seriously in short supply.

Other essential drugs that are in short supply are sodium valproate and lamotrigine for epilepsy as well as tenoric, atenolol, nifedipine, cardura, bisoprolol, aldactone, valsartan and hydrochlorothiazide for high blood pressure.

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