Harare — Zimbabwe's major pharmaceutical companies are facing collapse owing to the influx of cheap donor drugs, the Parliamentary Portfolio Committee on Health and Child Welfare heard yesterday.

Parliament also heard that Treasury had failed to recapitalise the National Pharmaceutical Company, the country's largest supplier of medicines to public health institutions.

Presenting evidence to the committee, Pharmaceuticals Manufacturers' Association chairperson Mr Emmanuel Mujuru said donors were supplying over 90 percent of primary medicines to public health institutions at highly-subsidised prices.

This made it difficult for local manufacturers to remain viable, especially in the absence of Government support.

"We are not getting the necessary support that we should be getting from Government.

"Most of the drugs coming into the country are funded and this has affected capacity utilisation and the industry is now running at 25 percent capacity. We are also not getting any credit lines," he said.

Mr Mujuru said local drug manufacturers were being hamstrung by the requirement that suppliers under United Nations programmes be World Health Organisation-certified.

He also said most donor sourced drugs entered the country duty-free, thereby making local products expensive.

"Import tariffs and value added tax are being levied on raw materials while finished drugs are landing duty-free. This is making us uncompetitive," he said.

Mr Mujuru said if the situation was not urgently rectified local manufacturers would fold.

He indicated that the problems afflicting the sector over the past seven years could also be attributed to the illegal economic sanctions imposed on Zimbabwe by some Western countries.

In her presentation, NatPharm representative Mrs Flora Sifeku said the organisation had held slightly over 40 percent of essential drugs in stock since June this year.

Mrs Sifeku said the company had 47 percent of drugs classified as vital in June, 49 percent in July, 20 percent in August and 31 percent in September.

Of the drugs classified as essential, she said, the organisation had only six percent of stock as of June, 20 percent as of July and August and 24 percent in September.

Mrs Sifeku said the statistics excluded anti-retroviral drugs.

"Of all this stock, NatPharm capacity holding is 15 percent and of the 15 percent stock of what we are holding 96 percent is donor stock and four percent is from the Ministry of Health," she said.

Mrs Sifeku said her organisation needed US$65 million to fully stock for a year although they were yet to receive any of the US$16 million promised under the 2008-2009 National Budget for recapitalisation.

"We had been promised US$16 million for 2009 and nothing has been allocated," said Mrs Sifeku.

Committee chairperson and former Health Minister Dr David Parirenyatwa said it was unacceptable that most of the drugs going to public health institutions where the majority accessed health care were donor funded.

"Clearly, it's a worrying situation that 96 percent of drugs are donor-funded."