At first sight, traffic of goods and people between Iraq and its neighbors seems to be normal and relatively under control. Yet, there is a silent plague making its way through the borders of the country: smuggled medicine. These trafficking operations rely on intermediaries on both sides of Iraq’s borders and provide medical supplies for stores, pharmacies as well as for the black market.
The smuggling of medicine in Iraq has a long history, starting after sanctions were imposed on Iraq in 1991. These sanctions that caused thousands of Iraqi lives started a culture of illegal trade between Iraq and the neighboring countries that lasted until today. The transition from a socialist economy based on local manufacturing to a free market and competitive economy has empowered various companies who do not hesitate to work under the umbrella of shady laws.
Dealers and private companies started importing and smuggling medication, selling them at below-the-market prices. This led to a crisis within Iraq’s local pharmaceutical industry. Contrary to previous companies, these new brokers and dealers were motivated by making profits, regardless of health issues that could stem from the poor quality of the drugs imported.
The amount of counterfeit medicines entering Iraq is large. Mr. Jawad Al-Mousawi, a member of the Parliamentary Health Committee gave The Red Line an insight of the extent of the illegal medicine smuggling industry in Iraq:
” 80% of the medicine entering Iraq and sold in pharmacies is counterfeited, and the reason behind this is that this industry is ran by drug distributing companies. “
He explained. Al-Mousawi blamed the ministry of Health and the pharmacists syndicate for this situation: “The weak measures and lack of inspection from governmental officials led to this deterioration and corruption in the pharmaceutical trade.”, he added.
This claim was rejected by government officials: “We completely reject any claims of negligence from the ministry of Health or the pharmacists syndicate.”, stated Muthanna Al-Taie, Iraq’s pharmacists syndicate spokesperson. The official also explained that the ministry of Health had tightened its measures in cooperation with the syndicate in order to force unauthorised pharmacies to close. “The smuggling of fraudulent medicines through borders are difficult to monitor, and the border control authorities are to blame for this phenomenon”, he added. It is worth mentioning that the Iraqi government has conducted a number of operations to counter corruption at border crossing points and custom services.
The role of party militias
Despite these highly mediatized initiatives from Mustafa al Kadhimi’s government on border crossing, trafficking of medicine remains important in Iraq partly because of political interference. A major factor undermining the fight against illegal importations of medicine in Iraq is the shady connexion between the Ministry of Health and the Kimadia Company for Medicines Marketing and Health Supplies. A doctor, speaking under condition of anonymity explained the intricacies of this collusive relationship:
“In the last 10 years, the ministry of Health has given Kimadia the monopoly of its medicine supplies in spite of many suspicions of corruption.”
The company is known for importing fake medicines and participation in smuggling operations. The reason why the ministry is dealing with this company is because it is supported by the Sadrist militia and political faction, the Peace Brigades (Sarayat al Salam).”
The same source added: “Many cancer patients that are treated in Iraqi hospitals die after a while because of ineffective medicine provided by Kimadia with approval of the Ministry of Health. The company has been obtaining huge contracts from the ministry for at least 10 years.”
The Doctors’ Syndicate tried to address the Ministry of health many times in order to prevent the government from dealing with this company, but these campaigns have unfortunately proven to be useless, the doctor claimed.
To point out the extent of the corruption the doctor revealed that, this same company was in charge of securing the initial batch of COVID-19 vaccines, which was received earlier in December 2020, but that these vaccines were reserved solely for the political elite and their relatives, no more.
Deals sealed in blood
A serious consequence of the illegal medicine trade in Iraq is that it further accelerated the eradication of the national pharmaceutical industry. When asked about the difference between local and imported medicines, Uday Slaiwa, a pharmaceutical engineer working in the Samarra Factory for Pharmaceutical industries explained how the local medicines are more expensive in comparison to the raw materials available in Iraq.”
Pre-2003 Iraqi regimes used to regulate the production of local products, and ensured a strict quality of manufacturing procedures. Additionally, a set of laws and import taxes were implemented to protect local industries.
However, with the liberalization of Iraq’s economy and the flooding of imported medicine, companies colluding with the political elite managed to avoid taxes and to import medicine to sell their products in Iraq at lower prices.
Despite old state laws in place to tax imported medicines, local pharmacies are full of imported medical supplies offering lower prices than local products. A source from the ministry of Health, who requested anonymity gave a piece of explanation to The Red Line :” Pharmaceutical companies, such as Kimadia import bottom quality, and sometimes fake medicines for the ministry of Health under erroneous pretext such as claiming that they are unavailable on the local market.”
Usually, the Iraqi government reduces and sometimes excludes federal taxes on imported products when the public sector is involved. This allows the private companies contracted by the government to import products at cheaper costs and avoid charges to benefit the vital Health sector. However, well intentioned measures can be taken advantage of. Our anonymous source within the ministry of Health continued: “After having acquired tax free products in cooperation with the ministry of Health, some private companies illegally sell these products to private warehouses that eventually supply private pharmacies.”
All this is done at the expense of the local, public medical production facilities that are not profitable.
The billions dollars-worth medical redistribution industry is based on a smuggling strategy rampaging across Iraq.
Using flaws in the legal system, poor law enforcing authorities have engaged in corrupt deals with the pharmaceutical tycoons of Iraq. The sealing of these unscrupulous deals was made with the blood of Iraqi victims.
Illegal border crossings
Other forms of smuggling take place through unofficial border crossings that are not under the government’s control, according to Mr. Slaiwa there are many unregulated border checkpoints through which fake medicines enter Iraq from Turkey, Jordan and Iran. According to an investigation published on The Independent Arabia newspaper: smuggled medicines control (70%) of the Iraqi market.
Although incapable of preventing the flooding of the Iraqi market of illegal medicine, the ministry of Interior regularly announces the seizure of smuggled medicine, especially on Iraqi-Iranian borders. The most recent of which was last October when Iraqi security forces thwarted the smuggling of more than (19 trucks) full of various types of unlicensed medicines. “The smuggled medicine was being transported through abandoned roads in Diyala province”, said Mr. Omar al-Waili, the head of the Border Authority. Mr. al Waili also pointed out that initial investigations on the incident lead to Iranian-backed militias who took advantage of the lack of monitoring by establishing unofficial border crossing points.”
The ministry of Interior is working hard to reinforce the idea that it has a law enforcement strategy to monitor borders and prevent smuggling operations. However, most fingers are pointing towards the militias as the government is trying to control the vast borders. This is even more troubling since these militias have gained legitimacy in the eyes of the State and get their funding from the government’s budget.
Commenting on the matter, Mr. al Waili told the Red Line: “We are doing our best, but there will always be major failure regarding the entry of any smuggled goods such as medicines. There are more than 21 unofficial border crossings in Iraq.” These unofficial border crossings represent a huge challenge to the border authorities in Iraq. According to Mr. al-Waili most of these smuggling stations have already been located by authorities: “These crossings bring goods from Iran and Syria into Iraq to the government’s knowledge”, he claimed.
Smuggling rate spike with covid
With the spread of the Corona pandemic in Iraq, the phenomenon of smuggling increased rapidly. The reasons are due to the health sector’s dysfunctionalities, and the insufficiency of medical supplies in Iraq.
Speaking on this matter, the head of the Iraqi Doctors Syndicate, Abdul Amir Al-Shammari claimed that the spread of the epidemic was instrumentalized to smuggle medical and pharmaceutical products, and distribute them to the markets at high prices.
During the pandemic, the ministry of Health lost control of the medical situation, which led to the growth of bad behaviours in the medical supply sector. “People’s panic, and the ministry’s incapability to provide medicines during the first wave have exacerbated the situation.”, Mr. al-Shammary explained.
Some private pharmacies and store owners partly supported the smuggling during the first wave, an owner of a private medicines store told the Red Line: “some of the smuggled medicines have actually saved people’s lives. With the travelling ban, restrictions on newly introduced medicines available in other countries, as well as an excruciating bureaucracy within the ministry of Health forced some companies to act quickly in order to provide for the people’s needs.”
The anonymous owner of this medical supplies store criticized the ministry of Health for turning a blind eye on the shady connexions between medical companies and some political factions. These illegal monopolies have prevented other businesses from expanding and ensuring the production of vital medical supplies in Iraq: “such hypocrisy has to be countered, otherwise people will always resort to illegal methods to sort out their affairs.”