Pakistan plans to tighten its drug pricing rules as Federal Minister Senator Ahad Cheema orders an urgent review of the framework used to approve medicine price increases.
The minister expressed concerns over the existing mechanism used by the Drug Regulatory Authority of Pakistan (DRAP). Therefore, he directed officials to develop a more transparent, evidence-based and independently verified system.
Government Orders DRAP Review
Senator Ahad Cheema chaired a meeting on drug pricing and instructed the Ministry of National Health Services and DRAP to revise the current framework.
In particular, the minister called for changes to the Hardship Policy, which allows pharmaceutical companies to seek relief in certain circumstances.
He said the policy should support companies only when they face genuine difficulties. At the same time, it must prevent businesses from shifting excessive costs to patients.
Furthermore, Cheema directed officials to finalize revised Hardship Rules and present them to the relevant forum for approval.
Changes Proposed for DRAP Board
The minister also called for changes to the composition of DRAP’s Policy Board.
He proposed adding a health economist and a public health expert to strengthen the board’s expertise.
According to Cheema, broader professional input could help the regulator make better pricing decisions and maintain a fair balance between industry needs and consumer interests.
Minister Questions Importer and Retailer Margins
During the meeting, DRAP officials briefed the minister about the existing Hardship Policy and its application to essential medicines.
Cheema also raised concerns about the margins earned by importers and retailers.
He noted that some importers seek relief under the Hardship Policy and later request additional price increases. As a result, he said the revised framework must address this practice.
The minister directed DRAP to review importer and retailer margins, including cases where margins may reach around 40 percent.
Supply Chain Must Share the Burden
Cheema said companies that receive government relief should also consider reducing their own margins.
“If the Government is extending relief under the Hardship Policy, the importer and retailer must also share the burden through reasonable adjustment of their margins,” he said.
Moreover, he stressed that companies must not pass the entire cost of such adjustments to consumers.
DRAP will therefore need to include a mechanism for rationalizing importer and retailer margins in the revised Hardship Rules.
Greater Transparency in Drug Pricing
The meeting also examined pricing methods for originator and existing brands.
DRAP officials explained that the regulator currently uses reference pricing for originator brands. This system compares medicine prices in neighboring and other relevant countries.
However, Cheema called for independent verification of the international data used in these calculations.
He said officials must ensure that the information accurately reflects actual market conditions.
Protecting Consumers
The minister emphasized that DRAP has a responsibility to maintain a fair balance in the pharmaceutical market.
On one hand, companies need sufficient commercial incentives to continue supplying essential medicines. On the other hand, patients need protection from unjustified price increases.
Therefore, the government wants the revised framework to support medicine availability while keeping prices affordable.
Cheema directed the concerned officials to complete the proposed changes and submit the revised framework for consideration and approval at the earliest opportunity.
The government says the new approach will aim to protect consumers while maintaining a sustainable pharmaceutical supply chain.
