While the Iranian Minister of Health, Bahram Eynollahi, insists on a solution to the country’s drug problem, reports paint a grim picture of a worsening crisis and significant challenges faced by pharmacies.
Despite public complaints about the lack of essential medicines, especially for special needs patients, Minister Eynollahi, on May 1st, criticized the increasing preference for imported drugs. He claimed the ministry’s focus is on supporting domestic knowledge-based companies to address the shortage.
However, Eynollahi’s criticism rings hollow in a situation where the scarcity extends beyond imported medications to domestically produced ones. The disrupted drug distribution cycle has created significant difficulties for both pharmacies and manufacturers, leading to closures of some pharmacies since late 2023.
Antibiotics, pen insulin, and heart medications are among the drugs facing frequent supply disruptions. Shahram Kalantari Khandani, head of the Pharmacists Association, described the dire situation in December 2023, stating that 40% of pharmacies were on the brink of bankruptcy due to difficulties in obtaining medicines and liquidity issues.
He highlighted that while settlement terms with drug distributors are typically long-term, the current shortage forces pharmacies to accept daily cash settlements, putting additional financial strain on them.
The financial crisis has also impacted manufacturing companies. Pharmaceutical companies cite government policies and delays in providing foreign currency for necessary raw materials as major contributors to the problem, forcing them to remove certain drugs from production.
Mojtaba Sarkandi, a drug manufacturer, warned that the 2024 drug market crisis has forced people to search multiple pharmacies for their medications, highlighting a situation that began months ago.
Adding to the crisis, a significant number of parliamentarians opposed referring the health commission’s report on the drug crisis to the judiciary for investigation into the causes and culprits. On May 4th, the opposition vote resulted in 67 votes in favor, 137 against, and 8 abstentions.
The health commission’s report identified government decisions as a key factor contributing to the current dire situation. Specifically, the Daruyar project, designed to prevent price increases and medicine scarcity, has demonstrably failed. The report reveals that within two years of the project’s implementation, medicine prices have skyrocketed by over 110%, ultimately increasing the financial burden on patients.
Furthermore, the report confirms that the price increases for at least 16% of the pharmaceutical items included in the Daruyar plan were not covered, further burdening patients.
The report also refutes the Ministry of Health’s claims about self-sufficiency in drug supply through domestic production. It confirms a serious shortage of around 150 commonly used drugs, with nearly 65 facing acute scarcity.
Other factors contributing to the crisis include the government and central bank’s inability to provide the necessary preferential exchange rate for medicine, ineffective central bank oversight on loan facilities for the pharmaceutical industry, and the government’s mismanagement of the drug cycle’s liquidity crisis.
Mohsen Kordi, CEO of a pharmaceutical company and drug expert, criticized the government’s decisions, highlighting warnings issued by pharmacists and experts last year about a potential “tsunami of bounced checks” from pharmaceutical companies. He lamented the lack of official attention to these warnings.
Kordi attributes the production decline to the government’s delay in providing the required foreign currency to companies. This currency, which should have been allocated at the beginning of 2023, was only provided in the fourth quarter. According to Kordi and other industry leaders, this delay significantly reduced drug production, leading to the current shortage in Iran.
