UAE new rules on drug monopolies reduce healthcare costs

The United Arab Emirates has introduced new rules to prevent monopolies in the distribution of medicines, a law aimed at lowering drug prices and reducing shortages, according to The National and agencies on February 26th.

The announcement sets out a mechanism requiring pharmaceutical manufacturers to appoint more than one authorised agent in the UAE for each registered medical product.

By ending single-agent controls, regulators say the system will diversify supply channels, increase competition and strengthen the country’s ability to respond to disruptions and demand in global pharmaceutical markets.

Drug shortages have periodically affected hospitals and pharmacies across the Middle East in recent years, driven by manufacturing delays, supply chain bottlenecks and spikes in national and international demand.

Shortages have also been reported for medicines treating Attention Deficit Hyperactivity Disorder, as well as for the antidepressant Prozac and other essential therapies.

Dr Fatima Al Kaabi, Director General of the Emirates Drug Establishment, said the legislation would play a pivotal role in regulating distribution, improving supply management efficiency and strengthening the system’s efficiency.

She added that the UAE is aiming to attract further pharmaceutical investment, with this reform part of a broader strategy to develop the country’s life sciences sector.

Medical specialists say the introduction of multiple authorised agents per product is likely to increase market competition. In monopolistic environments, distributors usually exert greater pricing power due to limited alternatives, hence abusing their dominant position. 

The UAE’s policy aligns with international standards for the scrutiny of anti-competitive practices in the pharmaceutical industry. In the United States, the Federal Trade Commission monitors merger agreements to safeguard competition, as the European Union provides specific directive measures to avoid abuses by monopolies.

For patients managing chronic conditions such as cardiovascular disease, diabetes and mental health disorders, uninterrupted and unconditional access to medication is critical.

Regulators say the new framework is designed to reduce systemic vulnerability and reinforce both affordability and supply stability in the healthcare system.

The National plus agencies, Maghrebi.org