Govt faces tall order in its fresh drive to end shortage of drugs

Sunday March 27 2016

MSD workers suppying drugs upcountry. The

MSD workers suppying drugs upcountry. The State-run agency says its gets a meagre budgetary allocation of Sh80 billion, a far cry from the Sh577 billion it would need to meet demand across the country.    PHOTO | FILE 

By Syriacus Buguzi @buguzi

Dar es Salaam. As the government embarks on  a new five-year plan to overhaul the country’s pharmaceutical sector, it faces a tall order coming up with long-term solutions to end the shortage of medical supplies in public health facilities.

Over the years, healthcare planners in government have earned credit for drafting good strategic plans on how to end the country’s healthcare challenges, but in the end, they come under criticism for failure to implement. 

Last week, the Permanent Secretary in the ministry of Health, Community Development, Gender, Children and the Elderly, Dr Mpoki Ulisubisya, said the government was now set to implement another grand plan in the health sector—targeting pharmaceutical development.

This time around, the government wants to come up with a well-researched strategy on how to tackle the challenges that hinder the availability of medicines in the country’s health facilities.

According to the PS, the grand project—costing about Sh21trillion, targets 80 per cent of Tanzania’s population who live in the rural parts of the country. 

On the campaign trail last year, President John Magufuli pledged that — if elected — he would seal the loopholes allowing unscrupulous health workers to steal medicines from public hospitals.

Since he took office, Dr Magufuli’s stance on how to improve the pharmaceutical sector didn’t change.  He believed, right from the start, that the remedy was to plug the loopholes that have for a long time been fertile ground for corruption. This partly meant shutting down the numerous pharmacies found adjacent to almost all public health facilities in the country.

The government then announced the move to close down the private drug shops and introduce government-run utilities, but this did not augur well with the owners of private drug shops. Health advocacy NGO, Sikika, which has done research on the shortage of medicines over the years, also challenged the move.

It was then that the government realised the need to work in harmony with the owners of private pharmacies, but to also introduce community outlets at public hospitals through the Medical Stores Department (MSD).

Perhaps it was also a difficult move by the government to eliminate private drug-shops near hospitals while there were frequent reports of drug-stock outs in the nearby public health facilities.

For many years, the MSD—an agency responsible for supplying vital medical equipment in the country  has been in the news for all the wrong reasons due to a myriad financial and logistical challenges.

On numerous occasions, MSD officials have been quoted complaining over budgetary constraints. Early this year, MSD director Laurian Rugambwa exclusively told The Citizen that his agency needed around Sh577 billion to deal with shortage of medical supplies.

This is  a far cry from the Sh80 billion budget that the agency operate on, he said. “For the past four years, we have not managed to accomplish the plans we set for drug procurement and distribution, due to poor budget allocations,” he said.

Under such circumstances, the need for an improved budget to finance the MSD, alongside proper management of the financial resources is a prerequisite.

As he announced a new move to develop the pharmaceutical sector last week, the PS for Health, Dr Ulisubisya, said that innovative approaches in terms of drug procurement, storage, supervision and distribution of medical supplies to hospitals would be adopted.

He said: “The government wants to set up a clear system that allows for the costs of drugs to be known right from where they are procured—unlike the current system, where middle-men determine the cost.’’

The government also wants to lay a good foundation for supervising the logistical and financial system for doing business with pharmaceutical industries in foreign countries.

“It will be easy to determine the cost of drugs on the market and the cost of distribution, including the port charges. You see, drug prices are affected by many factors including the dynamics of demand and supply,” he noted.

The latest plan, however, is not targeting the revival or development of local pharmaceutical industries. Although it’s an aspect that would relate well with the industrial sector, it emerges as an important feature that is clearly missing in the grand plans for pharmaceutical development.

But also, the revival and development of the local pharmaceutical industries missed out in President John Magufuli’s speech on the industrialisation plan.

During the speech he made in November last year, President Magufuli said he would create industries to produce goods for domestic consumption, such as clothes, shoes, cooking oil and so on.

His plan on industrialisation also included factories that would largely use domestic raw materials, mainly from agriculture, livestock, fishery and mining sectors.

However, the President did not highlight the need to develop local pharmaceutical productions—or even the revival of the industry, which has so far lost shape in the country. This is, despite reports showing the industry had recorded success between 1960 and 1980s.

Whether it was a deliberate omission or an oversight by the Head of State, the failure to invest in local pharmaceutical production means putting an end to the shortage of medicines and medical supplies in the country will remain a dream. 

Currently, more than 80 per cent of the medicines used locally and 100 per cent of laboratory reagents found in health facilities across the country are imported, according to data obtained from the Medical Stores Department (MSD).

History shows that investment in pharmaceutical firms has been declining over the years, since the 1980s.

Pharmaceutical production began in Tanzania in 1960–1980 with only four firms, acoording to reports. During the economic crisis in 1980s, two of the firms were closed down. However, 1989 to 2009 saw renewed expansion of the other firms.

The government firms reopened a partly privatised company known as Shelys created Tanzania’s largest pharmaceutical firm. Four new firms now emerged, including Zenufa Laboratories. The New investment included Shelys’ penicillins plant and Tanzanian Pharmaceutical Industries (TPI) anti-retroviral (ARVs) production. From 2003, the Tanzanian Food and Drug Authority (TFDA) sharply improved regulation.

By 2009, local production supplied around a third of medicines, and was particularly important for rural medicines access and by then, pharmaceuticals were a success story in Tanzania’s industrial environment.

Yet, by 2014, the industry in Tanzania had declined. Reports by Research on Poverty Alleviation(Repoa), show that market shares for the public and private pharmaceutical producers fell from around 30 per cent in 2006 to less than 20 per cent in 2013.  The MSD says gaps in local pharmaceutical production were some of the main reasons the country still suffers shortage of basic but vital medicines in hospitals.

Mr Rugambwa believes that the revival of local pharmaceutical industries would be a game-changer in Tanzania’s healthcare reforms as the country still relied on middle-men to procure even basic medications from foreign companies.

But the local firms are reportedly facing stiff challenges when it comes to investing in local production.

According to last year’s report by REPOA, there is a lack of active public sector support for local firms as compared to other competing countries.

“Government policy is totally unfriendly to pharmaceutical manufacturing (in Tanzania),” says one manufacturer who is quoted by the Repoa report.

Manufacturers argue that government policy currently undermines investment and innovation in their industry, further says the report

Local firms are moving out of production of basic and affordable medicines because they claim the drugs are no longer profitable, reducing production scale and potentially undermining ability to invest, says Repoa. The NGO revealed a weakening in the local procurement relationships between firms and the government’s medical stores department, MSD.

“MSD gives local firms a valued 15 percent price preference. However, working relationships with local suppliers are problematic,’’ Repoa reveals.

It goes on to explain that local firms complain of financial risk from the rising payment delays, lack of clear delivery dates, and failure to complete contracted purchases, plus low probability of winning (expensive) tenders.

In the end, Repoa says, the MSD is perceived as giving preference to imports, by providing trade credit only to overseas suppliers and buying supplies ‘bundled’ by local importers.

The MSD has publicly said in the recent past that there were plans by the department to start engaging local firms and promoting them in the production of some of the medical supplies.

A researcher on traditional medicine at  Muhimbili University of Health and Allied Sciences, Prof Rogassian Mahunnah, believes that Tanzania has a lot of potential in terms of plant species and expertise to develop its own local pharmaceutical industries but the country lacked enough financial resources.

“The biggest challenge Tanzania faces is the lack of money to build the industries and finance research and development of the drugs,’’ says Prof Mahunnah.

President Magufuli’s determination to bring the desired change in the handling of monetary matters and widening the tax collection base, could provide an opportune moment to develop pharmaceutical industries, and bring an end to the chronic shortage of medicine and medical supplies in hospitals.