Lira’s Slump Leaves Turks Searching for Hard-to-Find Medicines
(Bloomberg) -- Turkish patients are finding it increasingly difficult to access key drugs, with producers blaming the shortages on an inflexible pricing system for medicines that exposes them to losses from the lira’s swift decline.
Pharmacist associations are reporting supply problems with nearly 650 drugs, ranging from painkillers and cough syrups to treatments for asthma, influenza and cancer.
The second bottleneck in supplies in as many years shows how this year’s steep drop in the value of the lira is taking a toll on critical imports in a heavily regulated market place. It’s a serious matter for unwell Turks and another headache for President Recep Tayyip Erdogan, whose ruling party lost support as prices spiraled.
The government each year sets an exchange rate that pharmaceutical companies must use when pricing their products, many of which are imported or made in Turkey using ingredients from overseas. In February, officials set the rate at 4.57 liras per euro, roughly 60% below the current 11.27 liras.
That’s making imports punishingly expensive for most suppliers, resulting in a slowdown in domestic production, according to Nezih Barut, head of the Pharmaceutical Manufacturers Association of Turkey.
“Our industry has always been asked to make sacrifices. At this point, it’s got no more strength to do so. A drug priced at 10 euros in Greece sells for” the equivalent of 1.8 euros here, said Barut, who’s also the chairman of Istanbul-based pharmaceutical company Abdi Ibrahim Ilac Sanayi ve Ticaret AS.
The Ministry of Health declined to comment. Turkish authorities are prepared to prevent companies limiting access to drugs before the euro-lira exchange rate for 2022 is set, a senior official said, asking not to be identified, citing the sensitivity of the matter. A barcode system allows authorities to track production and deliveries across the nation.
The Turkish Pharmacists Association said “pricing should be done in line with economic reality.” Barut said manufacturers expect the exchange rate for next year to be set at least 30% higher, and urged officials to update it at least once during the year.
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