Price of drugs shoots up by 200 percent

Njabulo Ncube, Bureau Chief 7/5/01 7:00:30 PM (GMT +2)

BULAWAYO — The price of most essential drugs in Zimbabwe went up by a whopping 200 percent this week just when the country is reeling from an acute shortage of important medicines because of an ongoing foreign currency squeeze.

Citing Zimbabwe’s worsening economic and political climate, drug industry officials said the hike in the price of imported essential drugs was inevitable.

The price of essential drugs has been rising by about 50 percent every week for the past few months largely because of the prohibitive cost of acquiring scarce foreign currency from the black market to import the medicines.

Suppliers of drugs, just like most businesses in Zimbabwe involved in import and export, buy their foreign currency from the parallel market where forex is sold at a premium and where it is usually available.

In Bulawayo, where the black market flourishes despite a police blitz recently, the United States dollar was this week trading at $135 versus its official rate of $55 and the British pound, officially pegged at $80, was changing hands at $200.

The South African rand, held down at $7 by the central bank, traded at $18 and the Botswana pula was at $25 against the official bank rate of $8.99.

"We can confirm that most essential drugs have gone up by up to 200 percent," said Keith Gael, the chairman of the Retail Pharmacists’ Association of Zimbabwe.

"In fact, all drugs have gone up. It is an ongoing thing as the sector responds to what’s happening in the economy. The increase in the prices of drugs is happening daily, weekly and monthly. When the parallel market price goes up, everything goes up."

The most sought-after essential drugs whose cost has ballooned include antibiotics and a host of anti-malaria pills.

Retail pharmacists said supplies of these drugs were also dwindling fast as stockists failed to import because of foreign currency shortages.

Zimbabwe is believed to hold less than 65 percent of medicines featured on its essential drugs list, an inventory of crucial medicines such as antibiotics, shows.

There was no immediate comment from the Pharmaceutical Association of Zimbabwe and the Medicines Control Council, but government sources said state hospitals would start to feel the impact of the latest price increases in three months’ time.

"We (government hospitals) are not immediately affected as we operate a three-month buffer stock," a senior government medical doctor told the Financial Gazette. "At any given time, we have stocks that last us three months.

"We only buy after we have exhausted our stocks. Nonetheless, we are not exactly surprised by the ever-increasing costs of the drugs."

The rise in drug prices follows shock increases of up to 82 percent in the cost of fuel announced by the government last week.

http://www.fingaz.co.zw/fingaz/2001/July/July5/2047.shtml

-- Martin Thompson (mthom1927@aol.com), July 04, 2001