ISLAMABAD - The multinational pharmaceutical companies have proposed the government to rationalise taxes imposed on the sector in the upcoming budget, as the existing pricing mechanism in Pakistan is a major hurdle in the way of attracting foreign investment in the country and some multinational companies have even closed their operations in Pakistan during the past five years.
Shehryar Ansari, Co-Chairman of Pharma Bureau, said the multinational pharmaceutical companies are paying taxes of Rs 12 billion per annum and also pay sales tax to the government from their pocket, as they can not transfer it to the consumers.
He pointed out that many of the foreign multinational pharmaceutical brands could not be introduced in Pakistan due to registration, intellectual property protection and pricing issues. ‘If a pharmaceutical company wants to introduce a new molecule in Pakistan and goes for registration, the company may face dire consequences as the patent rights are not protected and many companies may come forward with the same molecular formula’.
Despite inherent strengths that the Pakistan market offers, many of the major international companies are reluctant to invest in the pharmaceutical sector in Pakistan in the absence of an enabling regulatory environment, he added.
They urged the government to implement a transparent and predictable pricing mechanism for the pharmaceutical industry enabling them to forecast growth, investment whilst continuing to produce quality medicines.
Unlike the local manufacturers, the multinational pharmaceutical companies’ representatives were of the view that there should be a level-playing field and they are not against the import of Indian drugs.
They maintained that the prices of their products are cheaper than the Indian pharmaceutical industry’s products and they can compete with them and would get a larger market in India to export their products if import and export is allowed by the next year under the agreement of most-favoured nation (MFN) status.
They regretted that due to non-release of ephedrine to the companies according to approved quota, the companies has not been able to produce the medicines that has ultimately troubled the patients. They said many companies received only 10 percent ephedrine quota against their approved quota requirement that is being given after verification by the drug regulatory body that the previous one has been utilised completely.
Asif Juma, Chairman of Pharma Bureau, said some of the imported drugs are being sold at higher prices creating an impression that local drug prices have been increased whereas the fact is since 2001 the government revised prices of only a few medicines whose products went to the Lahore High Court in 2010.
Briefing about the industry he said the $ 2 billion industry has employed over four million skilled labour in the country and the industry is also the largest employer of university graduates.
He said often a comparison is drawn between the Indian pharmaceutical industry and Pakistani pharmaceutical that not justified as $ 14 billion Indian has been ranked at number 15 while the ranking of Pakistani industry is at 45.
He informed that over 150 plants in India are US Food and Drug Administration (FDA) approved while in Pakistan not a single plant of pharmaceutical industry is approved by the FDA. Managing Director at Roche Pakistan and Country Manager for Pfizer Pakistan also spoke on the event.