Who stands behind penicillin crisis in Egypt?

CAIRO – 6 January 2018: Egypt’s Higher Public Funds Prosecution renewed on Saturday the detention of Medhat Shaarawy, former head of the state-owned company Academia International, for 15 days, pending investigation on charges of purposely causing the current penicillin shortage in the local market.

Shaarawy answered charges of founding a private company and moving the import process of penicillin to his own company by claiming that the new company’s establishment came upon a decision by Academia’s board of shareholders.

He claimed that this company is partly owned by foreign shareholders, which meant that the company was not able to import medicines in accordance with the Egyptian import regulations that have been amended.

Then, TechnoPharm started importing the medicines and transferred them to Academia for a 6.4-percent benefit to the private company, Shaarawy admitted.

Shaarawy claimed that there were more than 1.2 million packets of penicillin in Academia’s stocks immediately before him leaving.

He alleged that the penicillin crisis was triggered by Academia International’s failure to pay the foreign company for importing the penicillin, which led to the suspension of shipments.

The prosecution earlier stated in its complaint against Shaarawy that he purposefully threatened to sue the Chinese importer if he did not stop importing to Academia International. The Chinese importer subsequently withheld the drug to avoid facing a lawsuit, thereby creating a void in the market for the benefit of Shaarawy’s company.

The case of Shaarawy was snowballed through a complaint presented by the Health Ministry against Shaarawy. The complaint alleged that penicillin is a registered drug in the name of state-owned Academia International, which holds the rights to import and export it. Therefore, Shaarawy had no right to own a company that specialized in the same area and to use it as an alternative company in Academia deals.

Witnessing shortages in penicillin in the recent period, the Health Ministry's Pharmaceutical Inspection Department monitors the distribution of penicillin daily from Egyptian pharmaceutical trading companies to markets.

The director of the Department, Moustafa Al Sayed, has noted that the penicillin shortage is mainly occurring in private pharmacies and will be resolved, indicating that the Ministry of Health provided drugs to pharmacies affiliated only to the Egyptian pharmaceutical trading company to prevent a black market monopoly.