ISLAMABAD, Oct 15: The prices of drugs will rise beyond proportions and the undertaking which the pharmaceutical manufacturers have given to the industries ministry about not increasing the prices for a year will not hold for long, senior officials in the health ministry said.

An informed source told Dawn that the health ministry was still studying the implications of the Economic Coordination Committee’s decision that the industries ministry would be responsible to regulate drug prices.

It will be difficult for the industries ministry to perform the arduous job of pricing, specially in the absence of a workable formula, the source said.

He said, last year, the government had allowed the increase in medicine prices to three per cent on controlled drugs and four per cent on decontrolled ones on health ministry’s recommendations. On the other hand, he added, the industries ministry had moved a summary to increase the prices by six per cent on essential drugs and seven per cent on non-essential ones.

However, at that time, the cabinet had rejected the summary on the grounds that only the health ministry had the right to deal with the issue, he said.

According to the source, the current situation was worse than that of 1993 when the government had allowed partial deregulation of the medicines. The prices had then jumped from 250 to 600 per cent. This time, the price increase will be unlimited, the source said.

The implications of the ECC decision are not being spelled out correctly to President Musharraf, otherwise he will take a similar decision that he took on the general sales tax issue, he said.

The source said before ECC decision, every summary on drugs pricing moved by the industries ministry laid emphasis on reducing the prices of 100 items because they were higher in the region. However, soon after the decision, this aspect was quietly sidelined by the industries ministry.

He said the health ministry’s efforts to force pharmaceutical companies to reduce prices of 65 raw materials — after their rates dropped in the international market — failed when the industries ministry stepped in.