NEW TAX-EXEMPT DRUG LIST — THE ANOMALIES
Important life-savings drugs are already highly costly to the point of being unaffordable
By SYED M. ASLAM
April 29 - May 05, 2002
Like most of the countries of the world drugs enjoyed a tax-free status in Pakistan since it gained independence 55 years ago barring the single exception of levying of 10 per cent import duty on imported drugs in 1996 which remain in effect till today. For the first time ever the government announced to levy a sales tax on all kinds of drugs be it allopathic, homeopathic, or bio-chemic at the rate of 15 per cent, on the 21st of last month with immediate effect. Even the life-saving drugs, including some 850 salts, were not spared from the sales tax.
However, unified protests by the public and the media forced the Central Board of Revenue (CBR), the country's apex tax collecting agency, to issue a list of 256 life-saving drugs exempted from the sales tax at the retail level. The new list does not only exclude two-thirds of the drugs previously accepted as life-saving but also contain many anomalies. In addition, it has left out many important life-savings drugs which are already highly costly to the point of being unaffordable. With the imposition of 15 per cent GST they would become further expensive to aggravate situation for the suffering patients.
For instance, an anti-cancer medicine Taxol, a 30 mg injection imported by a multinational, retails for Rs 9,642.60 per vial. This important life-saving medicine in not included in the new list and thus is subjected to Rs 1,446.39 GST which pushes it price to Rs 11,089 per injection. This medicine is used in a course treatment which comprise a minimum of 45 injections the total costs of which without the GST previously totalled an unaffordable Rs 433,917. With the imposition of GST the total cost of the course would now cost Rs 499,005- Rs 65,000 more than it cost previously. In a country reeling from a low per capita income of Rs 24,000 the treatment equals 20 years' pay and that too if every single paisa of it is saved. Taxing an already unaffordable life-saving drug is a cruel joke to the cancer patients.
Similarly, another anti-cancer medicine, Zoldex 3.6 mg injection, marketed by a multinational is not included in the list. It retails for Rs 11,007 per vial and with the Rs 1,651.10 GST its price is pushed to Rs 12,658.46.
Even the medicines used by children in particular are not included in that all-compassionate list of the CBR. Meronem 500 mg inter-venous injection is primarily used to treat children suffering from birth deficiencies. It is life-saving but is not included in the list. A single dose of this medicine retails for Rs 826.43 which now retails for Rs 950 inclusive of Rs 123.96 gst. Similarly, P.A. 12 Lac injection used in the treatment of children with such life-threatening conditions as hole in the heart and manufactured by a multinational is just not available for years. The medicine which retails for Rs 15.13 and with the levy of GST will retail for Rs 17.40 is not supplied in the market by the MNC and though many local companies manufacture a substitute it is not as effective. Observers blame the unavailability on factors related to the manufacturer's concern that the medicine offers 'little profit of margin.'
While the preventive injection for Hepatitis-B is included in the tax-exempt list, its more important curative counterpart, a tablet, Zefix 150 mg, is subjected to the gst. A 14-tablet pack of Zefix previously retailed for Rs 1,406 per tablet which with the levy of GST now retails for Rs 1,617. A Hepatitis-B sufferer has to take one Zefix tablet daily for a whole year and the course, thus, now costs him over Rs 42,000 compared to Rs 36,656 or an additional Rs 5,500.
Another example of the anomaly is Amken injection used both by the children and adult. While the small dose of 100 mg used to treat children is not exempted from the GST its 250 mg and 500 mg vials meant for adults are included in the list and thus stand exempted from the tax. This is one glaring example of discrimination against the children, our future generation.
Maxipime is a life-saving medicine which many top surgeons and doctors refer to as an 'elixir'- 'working when all other other medicines fail.' This third-generation anti-biotic was not included in the exempt list thus pushing the price of its 500 mg injection from Rs 387.50 to Rs 445.62 and that of 1 gram vial from Rs 730.08 to Rs 839.59.
Tablet version of Paracetamol, an active ingredient used in the manufacture of everyday medicines, is exempted from the tax but Panadol syrup, its liquid substitute is not. This is just one example of tens of others such anomalies where injections are included but not the tablets, one variant of a dose is included but the other are not and vice versa. Somebody just didn't do the homework primarily as CBR is just not the right authority to issue the new list but the Ministry of Health should have been.
The most ridiculous anomaly is the inclusion of Oxytocin injection in the list of exempted medicines without mentioning the purpose. Oxytocin has both the human and veterinary applications. In pregnant women it is used to release harmones in for easier as well as smooth flow of the mother milk. However, in Pakistan it's veterinary use far exceeds its human use as it is injected daily into buffaloes to increase the quantity of milk. Observers say that 90 per cent of Oxyrocin is used for veterinary purpose in the country. Oxytocin is cruel to animals as it weakens them and shortens their lives and also poses credible harms to human life through the food-cycle. However, that's another subject and the fact is that the inclusion of the medicine in the tax-exempt list without specifying whether its for human or veterinary use the entire list extremely suspicious indeed.