Warnings of Medicine Shortages in Venezuela

Spokespersons for the pharmaceutical industry in Venezuela have warned that shortages of medicines exist in the country’s pharmacies, and hope that recent foreign currency allocations for imports will improve the situation.


Mérida, 8th August 2014 (Venezuelanalysis.com) – Spokespersons for the pharmaceutical industry in Venezuela have warned that shortages of medicines exist in the country’s pharmacies, and hope that recent foreign currency allocations for imports will improve the situation.

Throughout this year, and particularly in recent months, industry bodies have been reporting shortages of various medicines in the South American country’s network of pharmacies and health centers, including drugs to treat or control epilepsy, hypertension, AIDS and some forms of cancer.

The groups denounce that they have been unable to import sufficient pharmaceutical ingredients or medicines through state currency exchange controls this year.

Currency exchange controls have been in place since 2003 to prevent capital flight and aid economic planning and regulation. In order to import materials for production or finished goods companies operating in Venezuela must be granted access to dollars at the official exchange rate by the state regulator, Ceneoex.

However the system has been accused of creating economic distortions and lending itself to corruption, as those who are granted access to dollars at preferential rates may then try to sell these on the “black” market for profit instead of using them for the stated purpose.

In response to the falling value of the bolivar currency on the black market and a surge in requests for official priced dollars in what was suspected to be partially due to “false demand” for fraudulent purposes, the government has reformed currency controls and attempted to “streamline” the granting and use of foreign currency while a new system is developed.

Opponents have claimed that falling international reserves is the reason for reduced foreign currency allocations, an accusation which officials have rubbished.

Nevertheless various economic sectors, from car assemblers to national newspapers, have complained that legitimate imports have also been affected by the changes to the forex system, creating shortages across the economy.

The government has blamed shortages on an “economic war”, arguing that private sector groups are trying to undermine the economy for political reasons, and that many regulated goods are sent as contraband to Colombia where they fetch a higher price.

The president of the Venezuelan Pharmaceutical Federation (FFV), Freddy Ceballos, stated in an interview at the end of last month that his organisation had detected insufficient supply in 60% of medicines distributed in Venezuela.

Ceballos claimed that only 30% of the dollars requested by the pharmaceutical industry for importations of medicines to Venezuela had been granted, and that the lack of systematic currency grants made it difficult for pharmacy chains to forward plan in order to re-stock their inventories.

The FFV spokesperson, in an interview with Union Radio, said that the situation was “serious” and asked the government to provide an “immediate” solution.

Meanwhile the Pharmaceutical Industry Chamber (CIFAR), which represents 31 importers and producers of medicines in Venezuela, has reported that the situation is improving. The body confirmed recently that the state has been progressively granting the dollars requested by pharmaceutical companies this year, and that supply could begin to normalise itself in three months.

“The dynamic is positive, although it would be hoped that the debt [owed to international suppliers] was much less. The payments [granted recently through state currency controls] have allowed the reactivation of imports of primary materials and finished products to guarantee supply,” said Angel Marquez, the vice president of CIFAR, in mid July.

Further, the country’s laboratories reported at the end of July that 90% of the dollars they had been requesting for the importation of medicines and related materials had been granted, leading to the expectation by industry sources that both the production and supply of medicines in the country would improve by later this year.

Nonetheless, pharmaceutical industry spokesperson Ceballos was critical of the problem. “How did we get into this situation? Can patients wait five months until their medicines arrive? What is the state doing about this situation?” he asked in his interview.

Government stance

The Venezuelan government’s health minister, Dr. Francisco Armada, recognised the existence of medical shortages in mid-June, however argued that these were “specific” cases that were resolved within the shortest time possible.

“We’re making a big effort to acquire [medicines], and the items that can be absent are very few,” he stated to national media.

The minister also claimed that some pharmaceutical companies had not requested dollars for fresh imports and that they had “medicines available”, insinuating that such companies were not distributing their stocks. “[These are] actions linked to the economic war,” he said.

The health minister also argued that Venezuela should increase national production of medicines to depend less on imports from the international pharmaceutical industry, and mentioned the existence of agreements with allies such as China, Cuba, Argentina and Uruguay to import the prime materials for pharmaceutical production and distribution.

Health officials further highlight that many high cost medicines, such as for AIDS or cancer treatment, are provided for free in Venezuela, and that investment is being put into expanding the free public health system and the number of community doctors being trained for public service.