SAMARA, Iraq, March 2 (Reuters) - Fifty years ago, a much richer Iraqi government spent lavishly on health funding. The state company responsible for drug imports, known by its Arabic acronym KIMADIA, enjoyed such a close relationship with the world's top drug manufacturers that it would fax orders directly and shipments would arrive before a formal contract was drawn up.
In sharp contrast to the company's heyday in the 1970s and 1980s, today's KIMADIA does not have nearly enough money to cover Iraq's pharmaceutical needs.
In 2018, the state budget allocated $800 million for drugs. KIMADIA blew through it and accrued an additional $455 million in debt to pharmaceutical companies, in the end purchasing just 12% of the 535 drugs on its essential medicines list in large enough quantities to meet demand, said KIMADIA chief Mudhafar Abbas.
The next year, in response to pleas by the health minister at the time, Alaa Alwan, for additional funds, the government increased KIMADIA's budget to $1.27 billion. But once the agency settled its debts, this left roughly the same amount of money as the previous year; $810 million.
It was only due to smarter purchasing decisions and a crackdown on waste that procurement improved, officials say. Pressed by the continued lack of resources, the ministry also drew up emergency direct purchase deals with other governments including those of Turkey, Jordan, Lebanon, Iran, and India, and relied heavily on the WHO and UNICEF. All this work meant that in 2019, the government secured 235 drugs, 52% of its needs.
The budget crunch of the past two years hit cancer medicines the hardest, Reuters found, based on interviews with officials and an analysis of KIMADIA procurement documents. Cancer medicines, especially some chemotherapy cocktails, are among the most expensive medicines to buy.
In 2018, the Iraqi government purchased just 4 of the 59 core medicines the World Health Organization considers essential for cancer treatment. In 2019, the government purchased 37 of the 59 listed medicines, or 63% of the total recommended. Much of what did not get purchased were chemotherapy medications like procarbazine and fludarabine that target blood cancers like leukemia and Hodgkin lymphoma, diseases that are notoriously difficult to treat.
Even private importers struggle to get drugs into Iraq, Reuters found. Product registration rules have changed three times in the last five years alone, according to importers. It takes nine months to get a factory registered with the health ministry and two years for a drug.
When Islamic State took over an international road linking to Jordan, truck drivers were stopped by the militants and forced to pay tolls, for which they got receipts. By the time foreign companies had worked that into their business models, the government informed them paying the "toll" constituted funding terrorism.
They turned to the sea. Authorities at the port of Basra demand bribes of $30,000 per container to let drugs in, even if the paperwork is in order, several importers interviewed by Reuters said.
Many see no incentive to do things above board.
"You have to have someone to protect you," said one importer, who requested anonymity.
As a result, over 40% of medicine in the market is smuggled from countries including Turkey, Iran, Jordan, Lebanon, India and China, according to public statements from health officials.
"The state does not control the borders fully. It's not just counterfeit drugs being smuggled in, but even legitimately registered drugs, as some companies try to dodge fees or taxes. This is all part of the state of pharmaceutical chaos we are experiencing," said KIMADIA chief Abbas.
He estimates that Iraq has a $4-5 billion pharmaceutical market, with KIMADIA accounting for just 25%.
(reporting by Ahmed Aboulenein and Reade Levinson. Aboulenein reported from Iraq and Levinson reported from London; edited by Janet McBride and Elyse Tanouye)