September 15, 2023
The government of the Islamic Republic says the United States blocks pharmaceutical firms from selling medicines to Iran, but a spokesman for Novartis, the Swiss firm that is one of the five main pharmaceutical companies in the world, says the big problem is the failure of the Iranian government to provide foreign currencies to Iran medical importers.
The Intercept, an internet-based news operation, recently investigated Iran’s complaints about medical supplies. It found no one supporting the Iranian official line, though it found many who said the Americans were not helping to expedite medical supplies to Iran, as some US officials have claimed.
Pierre Omidyar, the Iranian-American founder of eBay, provided the capital to launch The Intercept in 2014, although he has nothing to do with its management.
The only comments on the drug issue to come from anyone with direct involvement came from a spokesman for Novartis.
He told The Intercept the company is willing to send medical supplies to Iran and has done so since the 2018 imposition of the “maximum pressure” sanctions by then-President Donald Trump. The sanctions have an exemption for food and medical supplies.
The problem created by sanctions, according to the spokesman, has little to do with the oft-cited fear of Western firms having legal problems with the US if they sell to Iran. Instead, he said, the problem is the inability of Iranian officials to access their own foreign currency reserves to make payments.
The sanctions, while not eliminating Iran’s foreign reserves, have frozen Iran’s access to them, sending the country’s accessible reserves from $122.5 billion down to a mere $4 billion between 2018 and 2020, according to International Monetary Fund figures. The disappearance of accessible reserves has made it impossible for the Iranian government to carry out basic economic functions like stabilizing its currency or engaging in normal foreign trade, even with willing parties.
The Iranian government must prioritize what it will use its limited foreign exchange to import food, medicine, cellphones, cars.
“Since the imposition of certain sanctions in 2018, the most significant challenge observed by many pharmaceutical companies has been a shortfall of foreign exchange made available by the Iranian government for the import of humanitarian goods, such as medicines,” said Michael Meo, the Novartis spokesman.
Iran has been most vocal about medications for thalassemia patients, saying the US blocks the sale of such medications, causing hundreds of Iranian thalassemia patients to die.
“With respect to thalassemia medicines specifically, Novartis has supplied these medicines continuously since 2019. We have been and remain ready to satisfy orders for these medicines.”
“However,” Meo’s statement continued, “for our medicines to reach thalassemia patients in Iran, Novartis relies on the action and collaboration of the Iran Ministry of Health and the Food and Drug Authority in allocating sufficient foreign currency resources to import these medicines through regular commercial channels.”
The complaint is not a new one. More than a decade of ago, the only woman ever to serve as health minister was fired by then-President Mahmud Ahmadi-nejad when she complained that the Central Bank was not providing the ministry with the foreign exchange the Majlis had approved for medical imports.
Tyler Cullis, an attorney at Ferrari & Associates, a DC-based law firm specializing in economic sanctions, told The Intercept, “At the end of the Obama Administration, we had ideas in front of the administration calling for a direct financial channel between the US and Iran that would be able to facilitate licensed and exempt trade between the two countries. To be frank, the Obama Administration rejected creating such a channel on multiple occasions,” said Cullis. “The US has now hit a dead end where they have used up all their levers of pressure other than military force.”
He went on, “I sympathize with folks in Iran, as there are a lot of people there who are nonpolitical and simply trying to find solutions. But it’s really hard to find a solution when the US government itself is not interested in one.”
“The original idea of such sanctions is that they will cause people to rise up and overthrow their government, but there is not much evidence of that while there is a lot of evidence that they harm ordinary people,” said Amir Handjani, a nonresident senior fellow at the Quincy Institute and a security fellow with the Truman National Security Project. “When you consider regular Iranians living under sanctions with rare diseases, who need specialized drugs that can only be imported from the West, they are facing a very dark future.”
A lawsuit currently filed in US federal court in Oregon on behalf of Iranians with thalassemia calls on the US government and the Office of Foreign Assets Control (OFAC), which administers sanctions and trade licenses, to “permit the reintroduction of life-saving medicines and medical devices into Iran through normal business channels.”
The suit was recently dismissed by the court on grounds that the plaintiffs lacked standing, meaning they could not sue because they were not personally impacted by the case. An appeal of the ruling was filed in May. Lawyers working on the case say they will continue pressing the matter in US courts to compel the US government to create a solution that will allow critical medicines to reach patients inside Iran. Of course, even with such a judicial ruling the medications will not reach Iranian patients if Iran won’t pay. “On a visceral level, people are suffering and dying. We’re talking about little children who need medical dressings [for thalassemia] and didn’t get them,” said Thomas Nelson, the attorney for the plaintiffs in the case. “No one is willing to stand up to the impunity and bullying of the US government on this subject, and particularly OFAC. It ought to be brought to the public’s attention that these types of things are happening.”