Photo Credit - Piqsels
Sri Lanka's National Medicines Regulatory Authority has warned that medicine prices across the island are likely to increase, as the country's pharmaceutical sector faces compounding pressure from a weakening rupee, rising global production costs, and surging shipping and insurance charges linked to the ongoing Middle East conflict.
NMRA Chairman Specialist Dr. Ananda Wijewickrama confirmed that pharmaceutical companies had already written to Health Ministry Secretary Specialist Dr. Anil Jasinghe, formally requesting a price hike of at least 7 per cent for the 60 medicines currently under price control, according to a report by the Aruna newspaper, as carried by Newswire.
The figure reflects how far import conditions have shifted since price controls were first imposed. State Pharmaceutical Corporation Chairman Shantha Bandara noted that when price controls were put in place, the US dollar stood at Rs. 295, but that as of 24 March it had climbed to Rs. 317.5, adding materially to the cost of every drug the country brings in from abroad. He said the 60 controlled medicines now require a minimum 7 per cent price increase, while other imports face higher costs due to rising production expenses, shipping, insurance, and expected electricity tariff hikes. Sri Lanka imports around 1,800 essential and other medicines, and the current situation has significantly raised import costs, Bandara added.
Pressure is mounting from the domestic side as well. The Association of Local Pharmaceutical Manufacturers has separately written to the Health Secretary seeking approval to raise prices. Local producers said packaging materials, raw materials, and production costs have all increased, compelling them to adjust prices. They further noted that about 250 medicines are manufactured locally by 13 pharmaceutical companies operating in the country, meaning the squeeze is felt not only in what Sri Lanka imports but in what it makes at home.
The warnings come at an acutely difficult moment. Sri Lanka has raised fuel prices on multiple occasions this month alone, with petrol now standing at Rs. 398 per litre and auto diesel at Rs. 382, figures not seen since the economic collapse of 2022. Sri Lankan president Anura Kumara Dissanayake told parliament that crude oil prices had risen by roughly 40 per cent in recent weeks, driven by the closure of the Strait of Hormuz, through which approximately a quarter of the world's seaborne oil trade passes. Every dollar increase in global oil prices, he noted, translates to approximately Rs. 2 in local fuel costs. The back-to-back fuel hikes have already pushed up transport costs across the economy, and the pharmaceutical sector, which depends on fuel for both the shipping of raw materials and the distribution of finished medicines, is no exception.
Sri Lanka imports approximately 85 to 90 per cent of its pharmaceutical requirements, leaving the sector structurally exposed to currency fluctuations and global supply chain disruptions. Many common drugs, including paracetamol and a range of antibiotics, rely on petrochemical derivatives in their manufacture, meaning that rising fuel prices push up production costs at the source, not merely at the point of delivery.
The NMRA introduced a landmark pricing reform in October 2025, setting maximum retail prices for 500 medicines and replacing the fragmented system that had left most essential drugs outside the scope of price control since 2016. The new framework, which parliament approved after years of legal wrangling between the regulator and the Sri Lanka Chamber of the Pharmaceutical Industry, was designed to bring transparency and stability to a sector long characterised by opaque, inconsistent pricing. Whether that framework can absorb the scale of the current cost pressures remains to be seen. The Government Medical Officers' Association had previously warned that the prolonged legal deadlock over price controls had left patients, particularly those with chronic illnesses, exposed to inflated private sector prices, with those in public hospitals forced to purchase medications out of pocket when supplies ran short.
The current warnings carry particular resonance given recent history. During the 2022 economic crisis, Sri Lanka's government announced a 40 per cent increase in the prices of a range of essential antibiotics, painkillers and other medicines, as dwindling foreign reserves made it increasingly difficult to finance pharmaceutical imports. Hospitals ran short of anaesthetics, chemotherapy agents and basic surgical supplies. Healthcare workers warned at the time that rising costs would cause people to buy less medication than prescribed, and the Government Medical Officers' Association reported that medicine and equipment prices had risen three to four times on the local market, pushing patients who could no longer afford prescriptions back into an already overstretched public hospital system.
The situation in the north and east of the island, where public health infrastructure has remained chronically underfunded in the years since the end of the war, has consistently left Tamils with fewer alternatives when medicine supplies tighten or prices rise.