In a significant development, the Ghanaian cedi gained strength in the final week of November 2024, stabilizing around GHS15.50 to the US dollar. This appreciation has sparked mixed reactions within the pharmaceutical industry, which heavily relies on imports for raw materials and finished products.
For pharmaceutical companies, the cedi’s improved exchange rate comes as a relief, easing the pressure of soaring import costs. Pharmaceuticals in Ghana are heavily reliant on imports. A stronger cedi reduces the cost of importing medications, raw materials, and other healthcare products, potentially lowering wholesale prices for distributors and pharmacies.
Despite the favorable exchange rate, consumers have yet to experience significant reductions in the prices of medicines. Analysts attribute this lag to the industry’s existing inventory, which was procured at previous, higher exchange rates. Retail prices are likely to reflect the current exchange rate only after existing stock is exhausted.
“Pharmaceutical pricing is complex,” noted Dr. Ama Boakyewaa, an economist specializing in the healthcare sector. “Even with a stronger cedi, factors such as operational costs, distribution expenses, and global market trends influence final prices. It may take several weeks or month for consumers to see tangible benefit”.
The High Street Journal undertook a survey from Ghanaians on the cost of common drugs used in the month of January compared to November, here is the breakdown.
| MEDICINE | PRICE IN JANUARY (GHS) | PRICE IN NOVEMBER (GHS) |
| Gebedol | 3 | 4 |
| Coarterm | 68 | 110 |
| Vermox tab | 20 | 28 |
| Lydia post pill | 8 | 17 |
| Dido-Denk 100 | 5 | 8.40 |
| Paracetamol | 2 | 3 |
| Zincofer | 50 | 65 |
| Amoxiclav 625 mg | 68 | 105 |
| Zulu | 10 | 12 |
Per the data given, there is an indication of more room for improvement in the pricing of commonly used drugs as far as the cedi rate is concerned. While the cedi’s gains are a positive sign, the pharmaceutical sector continues to face challenges. Persistent inflation and high fuel prices have kept operational costs elevated, offsetting some of the benefits of the stronger currency.
The cedi’s performance has brought cautious optimism to Ghana’s pharmaceutical industry. Should the currency maintain its strength or appreciate further, it could lead to more competitive pricing in the sector, ultimately benefiting consumers. However, the industry’s future will also depend on broader economic policies and global market conditions.
As of now, prices in the pharmaceutical industry may remain stable or exhibit slight decreases, depending on how quickly businesses adjust to the currency’s gain. However, significant reductions may require prolonged currency stability to offset previous pricing pressures.
