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The introduction of customs duty, surcharge and PAL for pharmaceuticals is another blow to the industry, said Chairman of Harcourts, Ahamed Rheyas.

In a press release Ahamed Rheyas, Chairman of Harcourts, one of the largest importers of pharmaceuticals in Sri Lanka said that barely a month back all pharmaceutical companies reduced the prices of drugs by 6.5% to give the benefit back to the patients, on the withdrawal of the Defence Levy which was a good move.

"It was shocking to note again that duty has been imposed on pharmaceuticals by 2% and 20% surcharge on duty and ports authority levy 1%. This will again result in pharmaceutical companies having to increase their prices to recover the additional costs incurred by them which adds up to 4.7%.

Rheyas said that the pharmaceutical companies are going through a very bad period due to various market factors and the very competitive environment. There are large number of products that are coming to the country as much as 50 brands of the same molecules are available in almost all the products. This is except for a few patented drugs. The market is not growing according to its expectations. The new step in the budget is certain to hinder the already ailing industry.

As it is patients are complaining about the high cost of drugs and how will they accept another price increase. The authorities concerned have to see that pharmaceuticals are completely exempted from duty, as it is an essential commodity for any country.

Almost all countries do not levy duty on pharmaceuticals. Sri Lanka also should consider to do the same, considering the benefit of the patient. Drug companies work on the formula given by the Fair Trading Commission (FTC). Obviously the FTC will have to give the importers a new formula considering the taxes at imports level. Customs have already implemented the new taxes effective from November 7 as per the Revenue Protection Order given by the Director General of Customs, he said.

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Copyright 2001 The Associated Newspapers of Ceylon Ltd.
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