Ahmed Hossain, employed in the private holder, purchases medicines worth Tk5,000 to 6,000 per month. He spends this amount on medicines for high blood pressure, gastric and heart diseases.
In addition to these medicines—he also spends a good amount on pathological tests and doctor’s fees. Along with this, the prices of medicines have never been stable and are continuously going high. He therefore, requested the authorities concerned to tighten the reins on medicine prices.
On January 9, the government raised the Value Added Tax (VAT) and supplementary duties on over a hundred products and services, including medicines. The VAT on medicine was hiked from 2.4% to 3% and was made effective from January 9.
In order to maintain price stability, the Directorate General of Drug Administration (DGDA) sets the maximum retail price (MRP) of each unit of medicine, including VAT, at the consumer level. Prior to January 9, the fixed price included 15% VAT at the production level and 2.4% VAT at the business. This VAT has now been increased to 3%. Therefore, there is a fear that the price of medicines will increase further.
The latest National Health Accounts from the Ministry of Health show that people in Bangladesh spend as much as 64% of their medical expenses on drugs. People spend 10.1%of their money on hospitals and clinics, 13.4% on physician’s chambers, 11.7% on diagnostic tests, 64.6% on medicines and 0.1% on medical equipment.
Drug sellers say that after the rise in dollar prices, the prices of several medicines have been increased in multiple rounds. Now owing to the hike in VAT, customers will have to spend an additional amount of money.
According to the Bangladesh Association of Pharmaceutical Industries (BAPI), the prices of various medicines have increased by up to 40% in the last few months. The prices of some medicines were increased before that as well. However, the DGDA said that the proposal to increase prices was made a year ago.
This year the proposal has been adjusted. The DGDA also noted that it has only approved a price hike for 10 medicines so far.
However, a visit to various pharmacies revealed a different picture. According to information provided by sellers, the prices of medicines for treating diabetes, gastric, high blood pressure and various infections have increased. Sources say that in order to increase the prices of medicines, approval has to be obtained from the DGDA.
Additionally, it is known that no decision has been made yet on how the new VAT will be levied. An official of the DGDA said that work is being done to reduce the additional costs of pharmaceutical companies in order to keep the price of medicines at a tolerable level.
Taslima, a resident of Mirpur in the capital, has been suffering from diabetes and high blood pressure for a long time. Expressing strong dissatisfaction over the costs of medicines, she said that her monthly expenses have increased due to the price of goods in the market. On top of that, the prices of medicines are also increasing.
Nurjahan Begum, adviser for the Ministry of Health and Family Welfare, held a meeting with stakeholders of the industry on Monday where it was decided that the list of essential medicines would be updated.
At the meeting, Professor Dr Saidur Rahman, secretary of the Health Services Division, said: “Vaccines play a role in preventing and curing diseases. Once we used to import 80% of medicines, but now we export our medicines to more than 150 countries. But most of the expenses that patients spend on getting treatment in our country go towards medicines. For this, we want to create an inclusive health framework.”
At the meeting, Abdul Muktadir, president of BAPI and chairman of Incepta Pharmaceuticals, said: “Currently, the drug market in the country is worth Tk30,000 crore. Nowhere in the world can one come by drugs at such cheap prices as in Bangladesh. Costs have increased in every sector, including electricity costs and staff salaries.”
“However, we also want the people to get medicines at affordable prices. We do not want to increase the price of any medicine. If we want to solve the problem, the list of essential medicines can be updated according to the WHO essential list and not according to anyone’s whim.”