Turkish medical producers took to the streets on September 15 to protest over unpaid bills worth hundreds of millions of dollars for equipment supplied to public and university hospitals.
As bne IntelliNews reported, government-controlled hospitals have accumulated overdue debts of 6 billion Turkish Liras (TRY) ($ 711.1 million) owed to local drug and medical equipment supply companies, according to Sekip Avdagic , Head of Istanbul Chamber of Commerce (ITO). The companies have not received payments from public hospitals for 18 months. There are about 14,000 companies in the sector and about half do business with the public sector.
Hundreds of protesters threw the keys to their desks on the ground in central Ankara in a symbolic challenge to officials to run businesses themselves without paying down debt.
Turkish public and university hospitals owe a total of 19 billion lire to drug makers and medical equipment companies, according to two major labor and business associations. They offered updated repayment rescheduling in 2018 and 2020.
“Not paid and desperate”
“The sector has remained unpaid and desperate despite having accepted two rebates in the past three years,” said Metin Demir, head of the Turkish Health Industry Employers Association (SEIS), as quoted by Reuters, adding: “We were twice forced to accept discounts of 27% and 25%, with the promise that all companies accepting this would be paid on time.”
He reportedly warned that any delay in supply caused by unpaid debts would disrupt health services. “We ask the Minister of Health to take these keys and run our businesses if he can, under the current circumstances,” Demir also reportedly told several hundred protesters.
SEIS reports that around 250,000 employees are affected by the debt impasse.
Last year, US Ambassador David Satterfield raised the issue. He said Ankara owed more than $ 2 billion to pharmaceutical companies, including the United States. He warned that companies would leave Turkey if they were not paid.
Healthcare costs in Turkey have risen sharply since the country’s currency crisis in 2018 due to a sharp depreciation of the Turkish lira. It has lost more than half of its value against the dollar. The difficulties with healthcare spending have been compounded by the coronavirus pandemic.
The government has so far offered supplier discounts combined with long amortization periods of up to three years.
“We no longer have the power to support the supply chain,” Demir also said, adding that supplier sacrifices were pushing the industry to the brink of bankruptcy.