Forecasting a Medical Humanitarian Disaster: When Sanctions Exemptions Exist Only on Paper

In creating its sanctions against Iran, the United States was required to ensure that humanitarian access to food and medicine was in no way impeded. Despite this, in October of 2018 the International Court of Justice ruled that the exemptions the U.S. had in place to protect this access were inadequate, while U.S. officials maintained what was currently in place was sufficient. United States exports of pharmaceutical products to Iran have dropped significantly since recent major policy changes, from an average of $26 million a year to $8.6 million a year according to data provided by the Census Bureau on U.S. Exports of Medical goods to Iran. Ignoring decreases in U.S. exports, the sanctions imposed on Iran by the United States complicate European pharmaceutical exports to Iran as well. 

Iran’s Food and Drug Administration Director General, Akbar Barandegi, asserts that around 100 local pharmaceutical companies are responsible for providing nearly 97% of medicines required by the people of Iran. This considerable production and export of generic pharmaceuticals helps lessen the cost of healthcare in Iran. However, the remaining 3% of pharmaceutical demand for specialized medications cannot be met by local production, making imports of these medications absolutely critical to the survival and wellbeing of the patients who need them. Restrictions on banking due to sanctions on Iran have led to pharmaceutical import shortages and rising costs, thanks to increased difficulty for importers in Iran to pay for exports from suppliers in Asia and Europe.

United States sanctions on Iran also interrupt supply chains, and harm domestic production as a result. The previously mentioned banking restrictions have in some cases made paying for items such as the raw materials required in the production of pharmaceuticals an impossible task, as suppliers are unable to reliably receive payment for raw materials sold to Iran. Medications are quite complex, requiring long lists of ingredients, but the inability to obtain even one ingredient means the whole process cannot continue and patients who require that medication to survive cannot obtain it. On top of this, U.S. sanctions on Iran have brought a decrease in Iran’s government revenues along with a decrease in access to foreign currencies. These respective drops lead to further declines in health care spending, reducing purchasing power of both healthcare providers and patients requiring medication. Data gathered by the Central Bank of Iran shows that healthcare has seen an almost 20% increase in cost between November 2017 and November 2018, and imported drugs are increasingly less attainable due to raised costs making medications unaffordable for those that need them, if they are available at all. 

With the price increases and import shortages of medications, smuggling of counterfeit and low-quality medicines into Iran through routes from Pakistan, Turkey, and the United Arab Emirates has increased. Some fear that if nothing is done to alleviate these issues counterfeit or impure ingredients could eventually end up in domestically-manufactured medications, with the result being drugs produced below quality standards with a slew of public health risks. According to a note in the Lancet, supplies of Asparaginase, Mercaptopurine, and Paracetamol, a chemotherapy medication, leukemia medication, and basic painkiller, respectively, had run out, putting treatment on hold for those who require those medications. 

Iran’s scientific researchers and doctors are bringing the urgency of the crisis into perspective through publications in medical journals specifically addressing the impact of sanctions on medicine and medical research. In a July 2018 article titled, “Impact of Sanctions on Cancer Care in Iran,” in The Archives of Bone & Joint Surgery journal, Dr. Mohammad Hassani explains, “[n]ovel chemotherapy drugs and new biologic anti-cancer agents are too expensive and Iranian public insurance system may not be able to afford it for the increasing number of patients. More than 95% of Iranians are covered by government insurance, but inability of public insurance to cover the cost of these expensive treatments restricts the access of middle and lower economic layers of the population to these agents.” 

Similarly, in the Winter 2019 issue of the Asia Oceania Journal of Nuclear Medicine & Biology, Dr. S. Rasoul Zakavi writes, “the negative effect of sanctions has ranged from death to different complications of disease mainly due to limited access to the drugs. The most critical patients have been affected the worst including children, patients with cancer, hemophilia, cardiovascular disease, asthma and epilepsy.” 

As the months of impasse continue, Iranians have been among the first to realize that the humanitarian exemptions the United States has in place in its current sanctions on Iran do not do enough protect access to pharmaceuticals, as those who require specific medications to survive are in many cases unable to receive the medicine they need. The ongoing situation is unlikely to resolve or improve without specific and concrete action on the part of major trade actors and policymakers.

by Kalyan Emerick

About the author: USIRCC