• Officials concerned by soaring prices
• Senate body to question industry on steep hikes

KARACHI: Prices of more than a hundred commonly used medicines have increased by an average of 32 per cent since February last year, after the caretaker government lifted price controls under its deregulation policy, prompting concern among officials and calls for the pharmaceutical industry to explain the steep hikes, according to officials and industry sources.

The steep rise has not only fuelled public anger but also caught the authorities off guard, as they had expected that price deregulation would promote competition and eventually bring down costs for consumers. However, the outcome appears to be quite the opposite.

The surge in medicine prices came to light through recent findings of an ongoing national survey ordered by the prime minister, following complaints from citizens, hospitals, and provincial health departments about soaring drug costs.

Chairman of the Senate Standing Committee on National Health Services, Regulations and Coordination, Senator Amir Waliuddin Chishti, told Dawn that officials of the federal health ministry and the Drug Regulatory Authority of Pakistan (DRAP) had informed the committee that an overall 32pc increase in medicine prices had been observed since the caretaker government deregulated non-essential medicines in February 2024.

He added that in some cases, prices had risen by as much as 100pc, while an increase of around 50pc was recorded in several others.

Senator Chishti said the purpose of deregulation was to boost competition, attract investment and increase exports, not to burden consumers.

Industry to face questions

He noted that a 32pc overall rise in medicine prices within two years warranted corrective action.

“We have decided to seek justification from the industry in all cases where medicine prices have increased by 50pc or more,” Senator Chishti added.

“We expect to meet industry representatives next month, and if we detect any element of cartelisation by the pharmaceutical sector, we will ask the Competition Commission of Pakistan to look into the matter.”

He said the committee did not want the pharmaceutical industry to suffer and wanted it to grow, but not at the expense of patients, who were already struggling due to the prevailing economic situation.

He continued that the committee was expecting recommendations from the prime minister on the pricing of non-essential medicines.

Before deregulation, pharmaceutical companies were allowed to increase prices by up to 7pc annually in line with the Consumer Price Index under the previous pricing system.

Officials pointed out that, under this formula, prices would have risen by about 14pc over two years, far lower than the 32pc surge witnessed after deregulation.

Claims rejected

The Pakistan Pharmaceutical Manufacturers Association (PPMA), however, rejected claims of an excessive price increase. It argued that the survey reflected an average rise of about 15pc and that, if the roughly 3pc linked to the launch of new products and strengths is excluded, the actual two-year increase stood at around 12pc.

PPMA’s Tauqeerul Haq said the deregulation was a timely move that prevented the collapse of the pharmaceutical industry amid soaring input costs, currency depreciation, inflation, rising energy and labour costs, and heavy taxation over the years.

“The policy helped restart production of many previously unavailable medicines, improved their availability, and curbed the circulation of counterfeit drugs during shortages,” he added.

The pharmaceutical industry argues that deregulation was necessary as the previous controlled pricing system made production unsustainable. Even under the old system, prices could not be raised without the federal cabinet’s approval. “Whenever a proposal to raise drug prices was presented, the cabinet would usually reject it due to political pressure,” said an industry representative. “Thus, deregulation was only possible during the caretaker government’s tenure.”

While deregulation has led to an increase in medicine prices, it has had a positive impact by resolving shortages of medicines at the retail level.

Abdul Samad Budhani, chairman of the Pakistan Chemists and Druggists Association, said the deregulation of medicine prices ensured abundant availability of medicines, ending persistent shortages.

He described deregulation as a necessary step to move away from centralised pricing controls that had hindered the sector’s ability to respond to rising production costs.

However, Mr Budhani noted that challenges remain for essential drugs classified as “hardship cases”.

“The real need for relief was in essential drugs, but their prices were not approved, while non-essential drugs received pricing approvals,” he said, adding that bureaucratic delays had contributed to shortages of some vital medicines.

Published in Dawn, November 10th, 2025