brand logo

How healthy is our pharma sector?

23 Jan 2022

  • The measures being taken to meet Sri Lanka’s medicine needs
By Sumudu Chamara During the last two years, especially after the Covid-19 pandemic broke out, Sri Lanka’s pharmaceutical sector faced both criticism as well as commendations due to various reasons, and there were also instances where the State-run pharmaceutical authorities/regulators were the centre of controversial situations that made national headlines. However, despite such challenges, the State-run pharmaceutical sector seems to be thriving, and is planning to manufacture at least 80% of the medicines that can be manufactured within the country in the next four years, while also developing the overall pharmaceutical sector in collaboration with the private sector. This was emphasised during a discussion held last week at the Presidential Media Centre. It was attended by State Ministry of Production, Supply, and Regulation of Pharmaceuticals Secretary Dr. Saman Rathnayake and State Pharmaceuticals Manufacturing Corporation (SPMC) Chairman Dr. Uthpala Indrawansa, and was moderated by President’s Spokesman Kingsly Rathnayaka. Medicine manufacturing in Sri Lanka One of the main topics the two speakers discussed was the SPMC’s Lotus Pharmaceutical Project in Horana, for which the Cabinet of Ministers granted approval in October last year.  Adding that the country will immensely benefit from this project, Dr. Indrawansa explained the SPMC’s medicine manufacturing capacity and how the Lotus Pharmaceutical Project will boost that capacity. “Earlier, SPMC’s medicine manufacturing capacity was 550 million pills and capsules a year, and plans had been made to boost that capacity to around 3,000 million pills and capsules a year,” he said, adding that although the plan was to achieve that target by 2023, by the end of 2020, it was possible to surpass that target. SPMC has now reached 3,040 million pills and capsules a year. Dr. Indrawansa added: “Last year, SPMC launched nine new medicines, and with this, the number of 100% Sri Lanka/SPMC-manufactured medicines have increased to 90. We are currently in the process of formulating 30 new medicines, and we have already started a project to formulate 55 new medicines. This is beneficial to the country, because getting formulas from other countries can cost around $ 50,000-80,000.  “SPMC has reached its full manufacturing capacity. Also, due to the current manufacturing speed, at some point, SPMC will no longer be able to further increase its manufacturing capacity. A committee was appointed in early 2020 in this regard, and it looked into what steps need be taken in order to further increase this capacity, and a decision was taken to establish three medicine manufacturing plants. They will manufacture pills and capsules that are being manufactured at present, orthopaedic equipment, and pills, capsules, and injections required for cancer treatments. For this project, SPMC received a 65-acre land from Millewa, Horana. By June of this year, the relevant construction work will begin. The plant that manufactures orthopaedic equipment will be built in one-and-a-half years, while the plant that manufactures cancer medicines will be built in two years. By mid-2024, the plant that manufactures other pills and capsules will be built, and its capacity is expected to be 3,500 million pills and capsules a year,” Dr. Indrawansa noted. Costs, investments, and imports Meanwhile, Dr. Rathnayake explained the monetary aspects of manufacturing medicines in Sri Lanka, and how private sector investments and public-private partnerships (PPPs) in the pharmaceutical sector could save Sri Lanka a massive amount of money. These initiatives, according to the two speakers, could also help boost and ensure the quality of locally manufactured medicines. Dr. Rathnayake explained: “The Government spent around $ 650 million in 2019 to import medicines. Now, local medicine manufacturers have increased their production, and we have been able to save around $ 20 million during the past two years. To further strengthen local production, steps are underway to construct a pharmaceutical manufacturing zone in Oyamaduwa, Anuradhapura, where around 200 types of medicines will be manufactured. The relevant construction work has already commenced, and the relevant agreements have also been signed. We are planning to complete the construction work in two years. At the same time, we are planning to build another such zone as a Board of Investment (BOI) project in Hambantota, where necessary ingredients will also be produced.” With regard to fund allocations for 2022, Dr. Rathnayake revealed that a total of Rs. 65 billion have been allocated by the Ministry. Of the full amount, Rs. 44 billion has been allocated for the State Pharmaceutical Corporation (SPC), Rs. 14 billion for the medical supply division (MSD), and Rs. 7 billion for the SPMC. Speaking of the prices of medicines and price controls, he noted that around 60 medicines have price controls, and although non-essential medicines do not have price controls, medicine manufacturers, or sellers cannot increase prices without the authority’s permission. However, according to him, there have been requests from the private pharmaceutical sector to hike prices of certain types of medicines. “Recently, medicine importers put forward a request for some kind of a relief, in light of increasing expenses and the foreign reserves crisis, which affect them. After careful consideration and studying the situation, we are planning to grant permission to give them reasonable relief,” Dr. Rathnayake added. Meanwhile, Dr. Indrawansa explained how the SPMC took additional steps to ensure the supply of medicines during the Covid-19 pandemic, while also making profits. He added: “SPMC did not stop operations during Covid-19. Most types of medicines used to treat common diseases such as diabetics, fever, and high blood pressure, are manufactured by SPMC. In a context where ports had been closed during the pandemic, had Sri Lanka been dependent on imported medicines, a shortage could have arisen. To face this possibility, in the early stages of the Covid-19 pandemic in Sri Lanka, we took a risky decision to import raw materials, and we had to even rent warehouses to keep manufacturing medicines. We always had medicines manufactured for a month.” Speaking of that period, Dr. Rathnayake said: “Advance planning was helpful when obtaining the necessary medicines and equipment, especially oxygen during the Covid-19 pandemic. Currently, we are discussing how to deal with our medicine needs during the ongoing foreign reserves crisis.” Dr. Indrawansa also noted that there is a huge demand for medicines from the private sector, despite the private sector being a main party that imports medicines. The demand, according to Dr. Indrawansa, is so high that sometimes it is difficult for SPMC to meet it. He also pointed out that in this context, SPMC has had to prioritise the parties it provides medicines to. He added: “Usually, we first issue medicines for public hospitals and then for the private sector. We will have the ability to give more stocks to the private sector once the new pharmaceutical plants are constructed.” However, according to Dr. Indrawansa, the quality of medicines is a big concern, especially due to the fact that the Government is planning to export medicines in future. He explained: “We will not be able to export Sri Lanka/SPMC-manufactured medicines if they do not meet international standards, including European standards known as EU-GMP (European Union’s Good Manufacturing Practice). All three new pharmaceutical manufacturing plants that are being built at present are aimed at exporting medicines once the local demand is met. We did a study to study Sri Lanka’s place as far as these standards are concerned. Bangladesh started manufacturing medicines in the 1980s, and Sri Lanka started 1987. However, today, Bangladesh has become self-sufficient in medicines, and manufacturing medicines is the second highest income generator in that country. They have over 260 pharmaceutical manufacturing plants, of which 32 meets the EU-GMP standards. Meanwhile, in 2021, India made around $ 25-30 billion from exporting medicines. Sri Lanka is behind Pakistan and Nepal too.” When asked about the profits, Dr. Indrawansa said that although SPMC usually keeps less profit margins due to the high demand, it has been able to make considerable profits, and that prices are usually decided by a committee appointed in 2008 which comprises officers from the Treasury, National Medicines Regulatory Authority (NMRA), and the Health Ministry among others. Pressing concerns The discussion also focused on several ongoing discussions about Sri Lanka’s pharmaceutical sector, especially medicine imports. In response to a question by a journalist about how manufacturing medicines locally would contribute to reduce medicine imports and whether Sri Lanka has completely stopped importation of medicines that are being manufactured locally, Dr. Indrawansa said that the public sector does not import any medicine that is being manufactured in the country, even though the private sector is allowed to import. Pointing out saline as an example for such a product, he noted that even though the Government produces enough saline units for the country, the private sector can still import it, and that a certain competition has been created. However, adding that increasing production and reducing imports is the main goal, he said that the SPMC is planning to sell saline to the private sector. The panellists also shed some light on the ongoing discussions on molnupiravir (an oral antiviral medicine for Covid-19). Dr. Rathnayake said: “At present, permission has been granted to six importers to import molnupiravir and one local manufacturer is even willing to manufacture that medicine. However, it is still being tested, and a large number of other types of drugs (for Covid-19) are also being tested. We are currently studying these medicines, and we still have not received any assurance that this medicine is actually effective. We have not taken a final decision yet.” He further spoke about how the health authorities are managing the availability of imported medicines and how the importation process has changed.  He added: “When importing medicines, we are being selective. We are focusing on importing medicines as they finish. Depending on what stocks of medicines are most likely to run out, we will decide what stocks need to be imported first or urgently. Based on the said decisions, we make sure that letters of credits (LCs) required to import medicines are issued on time. “The private sector, however, may face issues when importing medicines due to the foreign reserves issue. There may be a shortage of certain medicines. We are trying our best to prevent a shortage within the country’s hospital system, and we believe that we are able to provide essential medicines to hospitals. Based on the Treasury’s instructions, the SPC was provided with $ 11 million and SPMC with $ 5.3 million for medicine imports.  Responding to a question whether the foreign reserves crisis would create a medicine shortage in the country, Dr. Rathnayake said that Sri Lanka is facing such a risk, although such a situation has not arisen yet.  “That is why we have decided to identify what medicines are likely to run out first, and import them. We are trying our best to ensure that we have adequate US dollars to import medicines. A lot of people are used to purchasing medicines by their brand name. However, even though the prices of imported and locally manufactured medicines have a huge difference, the quality is not considerably different. At the same time, there are alternatives to certain medicines. Steps are being taken to ensure that certain imported medicines used widely by the people are available. However, due to the foreign reserves situation, we will only be able to minimise shortages (caused by the foreign reserves crisis),” he commented. Amidst these concerns and developments, both the speakers underscored the importance of the Covid-19 booster dose, or the third dose, that is being administered around the island.  The duo noted that even though the Pfizer-BioNTech vaccine was highly demanded initially, now, there are misconceptions about this vaccine, which is given as the booster dose, and that it has affected the number of people getting the booster dose. According to Dr. Rathnayake, Sri Lanka has spent over Rs. 66 billion for vaccines.


More News..