Egyptians and the drug shortage crisis

You may stand in a long line in front of El Esaaf pharmacy, one of the largest and most famous pharmacies at the centre of the Egyptian capital, Cairo, waiting to receive a medication that is in short supply, or an expensive alternative that may relieve some pain or heal a wound.

The journey of suffering in search of medicine in Egypt is exacerbated by the great scarcity of the dollar and the lack of a safe reserve of medicines and medical supplies, along with the continued difficulty of obtaining the foreign currency needed to import raw materials.

The danger in the crisis lies in the fact that the Egyptian market is one of the largest in the Middle East and North Africa region, with annual sales reaching 170 billion Egyptian pounds ($5.5 billion) in 2022, according to government data.

Local companies produce about four billion pharmaceutical units annually, valued at $3.5 billion, but the crisis lies in the fact that 98 per cent of the volume of Egyptian production depends on active ingredients and materials imported from abroad.

Pharmaceutical companies in Egypt import most of the raw materials from many countries, most notably the US, Germany, China, India, Switzerland and Denmark.

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According to the head of the Pharmaceutical Chamber of the Federation of Egyptian Industries, Gamal El-Leithy, 30 per cent of the drug items are facing a crisis as a result of the lack of production requirements, and the stocks of raw materials have declined to about two months’ supply, which is a dangerous indicator, stressing the sector’s need to provide $250 million per month.

Raw materials for drugs are among the top ten commodities that Egypt imported last year, valuing $3.8 billion, out of $94.5 billion in overall imports, according to official data.

Severe shortage

As the crisis continues due to 183 shipments worth $37 million being detained in Egyptian ports, patients suffer from the disappearance of vital medications, in addition to their high prices, despite the existence of 170 drug factories in the country, according to data issued by the state-run Egyptian Drug Authority.

Among the most important medications in short supply in the local market is Eltroxin Euthyrox T4 Thyroxine for thyroid patients, Glucophage XR 1000 for diabetics, Cystone for treating kidney stones, RH injection given before childbirth and Entresto to treat weak heart muscles.

The shortage extends to the treatment for epileptic seizures Depakine chrono 500, the drug Cervitam to treat dizziness, Pystinon Mestinon to improve the transmission of nerve signals and myasthenia gravis, the antidepressant Clopixol Depot, and Cerebrolysin 1 ml to treat all kinds of nerve infections, especially in cases of stroke, haemorrhages and postoperative trauma.

In addition to the drug shortage crisis, the Egyptian citizen is facing a significant increase in the prices of medicines including Agiolax, which is a laxative to treat constipation, which has tripled from 21 pounds (70 cents) to 60 pounds (about $2). The price of Milga Max has also increased, used to treat nerve damage and support cardiovascular health, from 145 pounds (about $4.70) to 195 pounds ($6.30) according to Egyptian pharmacists.

The price of one of the most important diabetes medications, Mellitofix Met 12.5/1000 mg, increased from 171.5 pounds ($5.50) to 214.5 pounds (about $7), the price of the vitamin SACROFER for treating anaemia rose from 106 pounds (about $3.50) to 146 pounds (about $4.80), and the drug Controloc 40 for the treatment of stomach ulcers from 90 pounds (about $3) to 130 pounds ($4.20).

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Meanwhile, other items witnessed record highs, including the RH injection, from 720 pounds ($23) to 1,215 pounds ($39), as well as Centrum, a food supplement that went from 355 pounds ($11.50) to 540 pounds ($17.50), and Cerebrolysin 5ml for the treatment of nerve infections, from 357.5 pounds (about $11.50) to 515 pounds ($16.70). The price increases even affected various infant formulas, ranging between $1.50 and $2.

The severe shortage extends to medical supplies, including electrocardiographs, blood sugar measuring strips, kidney filters, prosthetic devices and ultrasound devices, according to the head of the General Division for Medical Supplies at the Cairo Chamber of Commerce, Mohammed Ismail.

Patients suffer

Given all of this, the suffering of patients in Egypt, especially the poor and middle classes, is exacerbated, especially with the efforts of major companies and pharmacies to profit from the crisis and raise the prices of pharmaceutical items, as well as reduce the number of tablets, such as Actimar (a food supplement), which contained six sheets per box that cost $1 but now is reduced to three sheets costing about $2.

According to those working in the pharmaceutical market, pharmacies are selling expired medicines, claiming that the validity of the active substance, especially in tablets and capsules, continues after the expiration date of the medicine.

However, the strangest thing is that patients, especially in the Egyptian countryside, buy one sheet or pill or a few more of the needed medication, or resort to buying their medication in “instalments” or taking medication that has been used before in the form of donations of do-gooders.

M.A. (an Egyptian pharmacist) says that an elderly patient who is a regular at his pharmacy, stopped taking his heart medication for several days because of his inability to pay for the treatment. He noted that many people are joining the instalment system used at his pharmacy, located south of the capital.

It is common amongst Egyptians to skip going to the doctor and instead go directly to the pharmacist to request a prescription, or ignore the purchase of a prescription given to them by their doctor and instead get an effective injection or antibiotic for treatment in an attempt to bypass the high prices.

The Central Agency for Public Mobilisation and Statistics (CAPMAS) estimates the poverty rate in the country to stand at 27.9 per cent,or 31.4 million citizens, in 2019, but data issued by the World Bank states that about 60 per cent of Egypt’s population is either poor or at risk of poverty.

The causes of the crisis

According to an Egyptian official in a major drug company, who spoke to Middle East Monitor anonymously, the drug shortage crisis is due to 3 reasons, the first: the international companies producing the drug stopped or reduced their supplies to Egypt because of the compulsory pricing policy set by the Egyptian government.

The second reason: the existence of more than one exchange rate for the dollar, as the official price of the dollar against the pound reaches about 30.8 pounds, while the cost of the dollar in the parallel (black) market reaches 40 pounds, which exacerbates the losses of pharmaceutical companies.

The third reason: local companies suffer from a shortage of raw materials imported from abroad as a result of the scarcity of the dollar. This increased the volume of shipments held in Egyptian ports, in addition to the increased cost of shipping and unloading, manufacturing, and packaging. This means the profit from the medication drops given the high cost of production, which led to some companies’ reluctance to produce.

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More than 80 pharmaceutical companies submitted requests to the Egyptian Drug Authority to increase the prices of some of their products after the high prices of imported pharmaceutical raw materials, according to head of the Pharmaceutical Division of the General Federation of Egyptian Chambers of Commerce, Ali Aouf.

Military role

What the Egyptian media does not address about the causes of the crisis is the army’s interference in managing the drug market, through the monopoly of the Egyptian Authority for Unified Procurement (UPA) over the supply of medicines and medical supplies to all government agencies.

The current President, Abdel Fattah Al-Sisi, approved the law establishing the UPA in 2019, which provides for the transfer of the powers and competencies of the Ministry of Health, with regard to the drug sector and pharmaceutical supervision, to the UPA, headed by a general in the army.

The military institution continued its intervention in the pharmaceutical market, by pushing the Sovereign Fund of Egypt to establish a subsidiary fund to invest in health care, and to establish a partnership with the B Investments holding company to invest in the distribution and trade of medicines in 2020.

In April 2021, Al-Sisi inaugurated Medicine City in the city of Al-Khanka in Al-Qalyubia Governorate, north of Cairo to produce short supply medications and medicines for chronic diseases, thus enhancing the role of the army as a major player in the drug market.

During the current year, the Sovereign Fund of Egypt acquired a 49 per cent stake in the leading El-Ezaby Pharmacies chain, the annual sales of which are over two billion pounds (about $65 million).

Last month, a contract was signed for the establishment of six strategic warehouses to store medicines and medical supplies, between the Egyptian Armaments Authority on behalf of the Strategic Warehouses Company (governmental) and the Orascom-Weitz alliance. These steps all increase the role of the army in the drug market and increase the magnitude of the current crisis which is fuelled mainly by the scarcity of the dollar.

The views expressed in this article belong to the author and do not necessarily reflect the editorial policy of Middle East Monitor.