Iran's Health Minister: Preferential Currency for Medicine to be Eliminated from 2025

Iran's Minister of Health, Treatment, and Medical Education has announced that the preferential currency for medicine will be eliminated starting next year. Mohammad Reza Zafarghandi stated on Friday, December 9, that his ministry is preparing and planning to manage this change. This comes after the Central Bank of Iran claimed to have provided $1.5 billion in preferential currency for 'medicine and medical equipment' until September 19 of this year, while Zafarghandi had previously stated that the preferential currency for medicine had been removed. Earlier, the Minister of Health of the thirteenth government had also announced the removal of preferential currency for drug imports with the implementation of a plan called 'DaruYar' at the beginning of 2022. However, Iranian officials have made contradictory statements regarding the allocation of the '4200 Toman' currency for medicine. At that time, it was announced that instead of currency for medicine, an equivalent budget would be allocated to insurance companies to expand insurance coverage so that people would not need to buy medicine at free market prices. However, this plan has led to severe price increases for many pharmaceutical items, a crisis for pharmaceutical companies in importing raw materials, shortages of many medicines, and exorbitant out-of-pocket expenses for the public. In recent months, following increased criticism of the critical state of medicine, Mohammad Jafar Qaimpanah, the Executive Vice President and head of the Presidential Office, reported that Masoud Pezeshkian had instructed the Central Bank President to resolve the liquidity issues for supplying raw materials for pharmaceutical factories and importing medicines. A day later, Mohammad Reza Farzin, the Central Bank President, announced in a coordination meeting with officials from the Food and Drug Organization of the Ministry of Health and representatives from the pharmaceutical sector that the Central Bank had allocated financial facilities to solve the liquidity and currency issues for medicine imports, and a report was published regarding this matter. Nevertheless, representatives of the Chamber of Commerce and pharmaceutical companies have accused the Central Bank and the government of failing to allocate currency for importing essential goods, especially medicine. The critical state of medicine shortages has long reached a warning level, with Mohammad Ali Bandpay, a member of the Health and Treatment Commission's board, reporting months ago that the number of scarce medicines had exceeded 200 items. Now, the Minister of Health has also confirmed the issue of medicine shortages but stated that pharmaceutical items are monitored daily and continuously, and if a pharmacy lacks stock, 'if possible, it will be referred to another pharmacy that has the medicine available.' Mohammad Reza Zafarghandi also mentioned that if shortages occur at the national level, the reason is a lack of raw materials or reduced production in factories, which will be pursued and corrected on a case-by-case basis. He did not provide any explanation regarding the methods and strategies to compensate for the shortage of raw materials and medicines across the country. Domestic drug production in Iran is also facing a crisis due to a lack of liquidity for procuring raw materials for manufacturing factories, and according to the head of the Iranian Pharmacists Association, over 60% of domestic pharmaceutical production is 'low quality.'