The profiteering of pharmaceutical distribution companies and the resulting humanitarian disaster from the shortage of vital medicines in Iran
One of the most serious crises in Iran’s healthcare system is the hostage-taking of medicine distribution by companies affiliated with regime institutions—an issue that threatens not only pharmacies but directly endangers people’s lives.
One of the most common pressure tactics is “basket selling” of medicine and rationing of widely-used, life-saving drugs. This begins under the pretext of “supporting domestic production.” For example, a medicine like warfarin is first completely removed from the import list. Then, due to insufficient domestic production, it is distributed in a trickle to certain individuals close to the regime and ultimately sold on the black market at several times its original price. Pharmacies can only obtain this medication if they also purchase other low-demand but high-profit drugs.
Pharmacists and Doctors Concerned Over the Impact of Rising Drug Prices and Shortages in Iran https://t.co/XMftrI0tf9 pic.twitter.com/dAX0Ptdd30
— Iran Focus (@Iran_Focus) March 16, 2025
This method, which resembles pharmaceutical extortion, often results in medications expiring or becoming unusable while still in customs or the warehouses of distribution companies. Given the critical nature of some of these drugs, pharmacies and patients are forced to obtain them at any cost.
Another pressure tactic used by distribution companies is lowering the profit margin on essential medicines and shortening the repayment window for pharmacies. For instance, brand-name medications in fields such as chemotherapy, MS, and diabetes are offered with a minimal profit (around 6%) and short settlement periods (15 days to one month), while insurance organizations delay pharmacy payments for 6 to 8 months. This forces pharmacies to purchase Iranian or Chinese biosimilar products that offer higher margins and more lenient payment terms, a condition imposed by the distributors.
In the past two years of acute crisis and increased working capital requirements for pharmacies due to drug shortages, the legal departments of distribution companies have become more aggressive than ever. Exploiting the centralized banking system and market liquidity shortages, they seize bank accounts, confiscate the assets of pharmacy founders, and collect massive legal fees for even the slightest payment delays—without providing any formal notice or grace period for settlement.
Iranian Regime MP Warns About Intensified Medicine Shortages
What is noteworthy is that nearly all pharmaceutical distribution companies are directly or indirectly controlled by regime institutions. As a result, no independent body has the power to confront or oversee their actions. Consequently, the only victims of this corrupt and chaotic system are the people and patients.
As long as this regime-controlled structure persists, there is no hope for improvements in public health or equitable access to medicine. The only ultimate solution lies in moving beyond Iran’s regime, which is the root cause of this structural crisis.
