October 4, 2002	Friday	Rajab 26, 1423

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ISLAMABAD, Oct 3: The country is loosing a foreign exchange of Rs4 to 5 billion annually through transfer pricing of medicines by certain multi national companies (MNCs), said Foundation for the Preferment of Pharmaceutical Sciences (FPPS).

Sajjad Munir, the president of the FPPS, told reporters here on Thursday that there was a huge difference in the prices of molecules despite the fact that the patents of molecules were expired.

He added that the alleged unjustified transfer pricing must be checked by the Central Bureau of Revenue (CBR), which according to him, would definitely help decrease the prices of medicines and saving huge foreign exchange.

He also cited a study to establish a loss of $11.6 million per annum through the transfer pricing in the import of only 12 raw materials by the MNCs. Like Famotidine, a molecule, the patent of which have been expired was being imported at a price of $8,250 per kilogrammes to manufacture Pepcidine when the same raw material was being imported by the local manufacturers at $125 from Spain, a raw material which has been approved by the FDA of the US. Thus a loss of $836,875 was occurred in the import of 103 kg.

Similarly Ofloxacin was being imported at $2350 to produce Tarivid when the same was being imported by locals at $150 per Kg. A loss of $3.7 million occurred by importing 1696 kg. Diclofenac Sodium was being imported by the MNCs at $165.2 to manufacture Voltaren when the same was being imported by the locals at $35 per kg due to which the excess foreign exchange remittance per annum in the import of 1533 Kg amounted to $199,596. Amlodipine Besylate was being imported by the MNCs at $30000 per Kg to produce Norvasc when the same was being imported by locals at $500 per kg and in the import of 112 kg, the net loss was $2.8 million.

He alleged that the MNCs were importing Ceftriaxone at $700 per Kg to produce Rocephin when the same was being imported by the locals at $550 and to import 352 Kg, $52800 were remitted. “Similarly Doxycycline was being imported at $700 per Kg to produce Vibramycin when locals were importing the same at $60 per Kg and the government was facing a remittance of $143,360 in the import of 224 Kg. To produce Ciproxin, Ciprofloxacin was being imported at $900 Kg when the locals were importing the same at $95, thus a loss of $1.2 million was being caused to import 1477 Kg.

He said that technically there was no justification for allowing this plunder when the import policy clearly laid down that the import of raw materials should be done at international competitive rates.