Colombo, Healthcare

The vicious cycle that is eating away Sri Lanka’s healthcare: The Sri Lanka Pharmaceutical Corporation (SPC), the Ministry of Health and the Treasury

There has been a lot written about the blunders of the Ministry of Health after the death of two young children. However, even though the rubella vaccination has been secured from a supplier from a questionable background, there is no evidence of foul play. All vaccinations carry some danger to the recipient and occasionally there is the threat of death. What happened to these two girls could be described as a severe case of anaphylactic shock due to severe allergy.

However, there are grave problems with the Health System in Sri Lanka. In a recent study by Transparency International, Sri Lanka’s health care system remained the most corrupt after education. The corruption stems from the point of birth to death, where relatives, for instance, have to pay off individuals who clear the body of the deceased. However, this is not to say that corruption in the healthcare system occurs just at the lower levels.

There are of course grave problems with the Sri Lanka Pharmaceutical Corporation (SPC), which is responsible for buying medicines for the Ministry of Health. Some officials of the SPC would tell you that they produce nearly 10% of the drugs needed in Sri Lanka. This is not the whole truth, what generally happens is a certain form of value addition at the SPC; we receive drugs in the form of powder or liquids which we turn to tablet or a syrup. The government of Sri Lanka (GoSL) then spends more than Rs.17 billion (2001) on drug imports. We import nearly 60% of our drugs from India, since it guarantees a good price. So, one may wonder what the problem is?

Sri Lanka acquires the drugs through a tender process, which is quite transparent. The SPC is responsible for these tenders and charges a nominal service charge for its services. Unfortunately for the Sri Lankan consumer, the tenders are awarded to the lowest bidder, who has presented samples that have passed inspection. As any schoolchild would tell you, lowest prices do not guarantee the best quality; more often than not it only results in the procurement of the worst quality of drugs. After the purchase of drugs, two further tests are meant to take place – once the drugs shipment reaches Sri Lanka and again when the drugs are distributed across the island. But a former SPC official stated in a condition of anonymity that this does not happen, due to a severe lack of funds and human resources. Furthermore, if the SPC takes steps to award a tender for a supplier with a higher price on issues of quality, the treasury would oppose any such payment. The treasury in the best of circumstances does not release the funds on time; as far back as 2001 the SPC was spending close to Rs. 300,000 a day on interest payments, which had to be incurred due to commercial borrowing.

The problem runs deeper. While Sri Lankan law requires that the manufacture of drugs meet World Health Organization – Good Manufacture Practices (WHO-GMP) by showing some documentation, it does not take any steps to verify these documents. These documents can be easily forged in India. Furthermore, nearly 25% of the drugs, which reach the island, are destroyed or lost. This costs the average taxpayer more than 4 billion rupees. The major reason for the waste of 4 billion rupees of medicine is poor storage. The storage conditions are appalling in Sri Lanka. This leads to medicines being stolen from storage facilities, and even worse it leads to the drugs being contaminated. The Sri Lankan legislation that governs these practices are outdated, the Act was initially passed in 1980 and needs to be amended to reflect the current context.

There are certain steps that can be taken in order to address some of these issues. Firstly, we need a mindset change. Getting the cheapest drugs from a supplier is not the best practice, since cheap does not ensure quality, especially since the testing mechanisms do not function. Our tender process would have to change, SPC would have to do costing for the drugs prior to making orders, this would give the officials at home the necessary information on how much it would cost to produce the drug at optimum conditions.

The Ministry must not simply wait for disaster to strike. It could send medical teams to check out and approve the manufacturing facilities that SPC makes its purchases from. By negotiation with the supplier and the GoSL, most costs for this mission could be covered. The 5-member team of health experts would require up to 3 full working days to inspect a site, to evaluate if it meets the minimum standards set out by the WHO-GMP. This is a bare minimum requirement.

The storage facilities in Sri Lanka have to be brought to WHO standards. The expiry dates of drugs are based on assumption that they would be stored under optimum conditions, absent of the drugs would expire faster. This would lead to serious complications. To restore the current storage facilities the cost is estimated to be Rs. 3 billion. This would be a one-time cost, and would save more than Rs. 4 billion a year, whilst assuring the quality of drugs.

Finally, the treasury would have to fund the SPC in a timely manner so it would not have to incur huge losses from taking commercial loans. The SPC would need more funding so it could carry out its independent testing of drugs and be able to hire the necessary personal to do so. Taking these steps would ensure that the drugs that are brought in to this country are of a suitable standard for usage.