While Iran’s regime claims to intervene in the healthcare economy to support vulnerable groups, a report by the regime’s Majlis (Parliament) Research Center and official statistics show that patients’ share of treatment costs in Iran has risen to as much as 70%, and more than 83% of the pharmaceutical sales market is controlled by 55 quasi-governmental companies.
On Monday, June 9, the state-run daily Shargh, citing a report by the regime’s Majlis Research Center, wrote that around 97% of the medications consumed in the country are produced domestically. However, the majority of this production is controlled by governmental and quasi-governmental bodies. According to experts, this situation has “created monopolies, reduced competition, and weakened transparency in the pharmaceutical industry.”
This report, titled “The Share of Quasi-Governmental Entities in the Pharmaceutical Industry Economy,” shows that six quasi-governmental institutions—including the Social Security Organization, the Social Security Investment Company, Bank Melli (National Bank), the Execution of Imam Khomeini’s Order (EIKO), Sobhan Pharmaceutical Investment, and Alborz Investment—own a large number of pharmaceutical companies and hold a significant share of the country’s pharmaceutical market.
More than 83% of the pharmaceutical sales market is held by 55 companies
Shargh’s report states that out of the 296 pharmaceutical companies in the country, only 42 had been listed on the stock market by 2022 and operate transparently. Meanwhile, 55 companies with the highest share of sales by value together control over 83% of the pharmaceutical market.
Among these 55 companies, the Social Security Organization owns nine, the Execution of Imam Khomeini’s Order owns five, and Bank Melli owns four.
Based on this, the Social Security Organization controls 17%, the Execution of Khomeini’s Order 7%, and Bank Melli 5% of Iran’s pharmaceutical market.
In contrast, the private sector as a whole control around 53% of the market, but 36% of that is held by just seven holding companies.
According to the goals set in Iran’s Fourth and Fifth Development Plans, patients’ share of treatment costs was supposed to be reduced to about 30%. However, according to the World Bank, the global average is only around 18%.
Massive government debt and liquidity crisis in the healthcare sector
One of the main causes of this situation is the government’s mounting debt to hospitals, pharmaceutical factories, and pharmacies. Due to repeated delays in payments, some pharmacies announced in March that they would stop selling medication through insurance.
Pharmaceutical companies say that the government’s price controls have caused them financial losses, and the state lacks the capacity to pay compensatory subsidies. The result of these conditions has been a reduction in production and shortages of medicine in the market.
Pharmacies are also facing a similar crisis. Delays in payments by insurance providers have led some pharmacies to only offer medications at full, unsubsidized prices.
Public hospitals have reported that the lack of liquidity has prevented the renewal of equipment, and there are delays in paying the salaries of healthcare staff—a situation that has contributed to the emigration of doctors and nurses.
Millions uninsured and vulnerable to healthcare costs
A 2020 study by Iran’s regime Ministry of Cooperatives, Labour, and Social Welfare showed that about 16% of Iran’s population—equivalent to 13.5 million people—lacked health insurance. In Tehran province, this figure reached 21%. Before the COVID-19 pandemic, Iranians paid approximately 35% of their medical expenses out of pocket—almost twice the global average.
According to the Ministry of Welfare, about 2.4 million Iranians fell below the poverty line in the same year due to high medical costs. International studies also indicate that the cost of surgeries in Iran is higher than in 93 other countries.
Fatemeh Mohammad-Beigi, the secretary of the Health Commission in regime’s Majlis, said in March: “Today we are facing the phenomenon of people giving up on filling their prescriptions. Many go to the pharmacy but return empty-handed because they can’t afford the high prices. People cannot afford to buy medicine or medical supplies. Out-of-pocket spending has risen from 45% to 70%.”
Despite Mohammad-Beigi’s remarks, Mehdi Pirsalehi, head of the Food and Drug Administration, responded to reports of patients foregoing medication purchases by saying: “We have not received any reports of people declining to buy their medicine. Insurance providers have not reported this either. Unfortunately, these are just media talking points.”
Decrease in dental visits and rise in tooth decay
In the field of oral health, financial hardship has also had clear impacts.
Ali Tajernia, then-chairman of the Iranian Dental Association in 2023, stated that most people only visit a dentist when the pain becomes unbearable.
According to him, over the past 20 years, tooth decay among Iranians has tripled, and high costs have reduced visits to treatment centers.
Reports indicate that each six-year-old Iranian child has on average, more than five decayed teeth.
Additionally, individuals aged 30 to 40—those in their socially active years—have lost an average of 12 to 13 teeth, and more than 55% of seniors over age 65 have no teeth at all.
