* Doctors, pharmacists report widespread drugs shortages
* Cancer, MS, blood disorder treatments seriously affected
* Stockpiling compounds the lack of vital drugs
By Marcus George and Zahra Hosseinian
DUBAI/ZURICH, Dec 5 (Reuters) - Doctors in Iran are trying to fend off a creeping health care crisis caused by medicine shortages, due in part to Western economic sanctions but exacerbated by government mismanagement and abuse of the system.
Government hospitals and pharmacies report a widespread lack of drugs to treat cancer, multiple sclerosis, blood disorders and other serious conditions. Iranian media highlighted the shortages earlier this month through the case of a teenager who died of haemophilia after his family failed to find his medicine.
Both the United States and the European Union say their embargoes do not target trade in humanitarian goods. But cutting off Iran's banking system from the outside world has touched every sector of the economy, resulting in spiralling food prices, a plunging Iranian rial, deepening unemployment and now, hitting health care, analysts and traders say.
Western officials appear increasingly sensitive to allegations the measures put the lives of Iranians in danger.
"There's a serious shortage of cancer medicine. The lives of so many patients are at risk," one cancer specialist said by phone from Tehran. A wide range of drugs was no longer available, he said, and finding alternatives was a complex challenge.
Last month Iranian media published a list of dozens of drugs in short supply, and others - including chemotherapy treatment drugs Doxorubicin, Fluorouracil and Cytarabine - which could no longer be found.
Health officials have accused the government of compounding the shortages by failing to provide billions of dollars of vital funds earmarked for drugs and medical supplies.
"Those who have relatives in the West can ask them to get pills but how are they going to pay for them when the rial has lost so much of its value to the dollar?" the doctor said.
Iran's currency has depreciated by more than half since the beginning of the year, leaving most Iranians struggling to pay for basic goods, let alone expensive imported medications.
Ali, 68, has been treated for Alzheimer's disease for the last four years. In recent weeks he has been unable to purchase the German-made drug he takes in Iran and is now waiting for his medication to be delivered from France, where his son lives.
"It's really frustrating. It'll be really difficult to pay for them. We're talking expensive pills here," he said by phone.
Ali's insurance policy covers drugs bought in Iran but not abroad, and his bill was expected to run to hundreds of dollars.
The issue has sparked ferocious attacks on the United States and European Union sanctions from pharmacists, doctors and medical institutions inside Iran.
"The objective behind these illegal and inhumane sanctions is to apply pressure on the Iranian government by inflicting pain and misery upon ordinary people," Dr Alireza Marandi, of Iran's Academy of Medical Sciences, said in a recent letter to U.N. Secretary General Ban Ki-Moon.
"These brutal measures have led to a significant rise in suffering as well as increased mortality rates."
The United States denies it is to blame.
"It has been the longstanding policy of the United States not to target Iranian imports of humanitarian items, such as food, medicine and medical devices," said a Treasury spokesman.
In October, the United States introduced a "standing authorization" that permitted U.S. companies to sell certain medicines and supplies without first seeking a licence from the Treasury's Office of Foreign Assets Control, he said.
"If there is in fact a shortage of some medicines in Iran, it is due to choices made by the Iranian government, not the U.S. government," he said.
Both London and Washington have aimed to communicate such views to ordinary Iranians through social media and online forums in recent weeks, concerned that hardships caused by the sanctions are overshadowing their message about the dangers of Iran's nuclear programme.
Tehran's plan to enrich uranium has fuelled Western fears the clerical leadership is intent on developing a nuclear weapons capability. Tehran says it only wants a domestic nuclear energy programme.
A British government spokesperson said the situation was being "compounded by the Iranian government's economic mismanagement".
Critics inside Iran, and even within the government itself, have accused officials of negligence by launching costly economic reforms at a time of increasing uncertainty and reduced government revenues.
Facing a slump in the amount of foreign reserves caused by sanctions against its oil exports, analysts say there is a tug-of-war between factions over who can access Iran's petro-dollars, and government departments are losing out.
The amount of foreign reserves held by Iran is not known, but analysts and diplomats say it could be as little as $40 billion, with around a third of that stuck in foreign accounts and therefore inaccessible.
Iran subsidises the purchase of dollars at the rate of 12,260 rials to the dollar for importing essential items including medicine and basic food stuffs. The open market exchange rate is around 30,000 rials.
Last month, Minister of Health Marzieh Vahid Dastjerdi said only a quarter of the $2.4 billion earmarked for medicine imports had been provided for the current year and there was a deficit of foreign currency for shipments.
"Medicine is more essential than bread. I have heard that luxury cars have been imported with subsidized dollars but I don't know what happened to the dollars that were supposed to be allocated for importing medicine," she said on state television.
A source inside a government pharmacy in Tehran said that low stocks of vital drugs were being exacerbated by "strategic stockpiling". Of 20 units of medication, two were available to the public and the rest "reserved" for those who have influence or good connections, said the source.
Some importers also complain they can no longer access the government's subsidised dollar rate because some medicines have been taken off the priority list. Instead of struggling on, many businesses have decided to close down.
Last Friday Mohammad Abdzadeh, the director general for supervision of medicine, told Fars news agency that $130 million of shipments had begun and would be completed in two weeks.
"After these special shipments we will proceed normally with imports and I hope we will no longer see any further shortages like those of the last one or two months," he said.
Some have benefited from the crisis - there is a growing market in Iranian and Chinese alternatives to drugs in short supply, for example. But while Iran has trumpeted domestic production of medicines in a drive towards self-sufficiency, doctors and pharmacists say they are reluctant to use many of them.
"Doctors just don't want to take the risks with local drugs. In some cases they are jeopardizing the health of patients," said a Western businessman who exports pharmaceutical products to Iran and visits the country regularly.
"The price for imported medicines may be 10 times more but they're still going to prescribe them if they can," he said.
There have even been reports of unwanted pregnancies due to the shortage in effective contraceptives.
A brand of contraceptive manufactured by the German pharmaceutical giant Bayer which had been widely sold in pharmacies is now nowhere to be found, said Ahmad, who imported it until the volatile currency situation forced him to stop.
"There are now some birth-control pills in the market from China. They just don't work," he said, asking to be identified only by his first name.
"I've heard of several cases where women on those got pregnant. This is not a joke. It's really serious."
One Tehran resident said there was a shortage of Western-made condoms in Iran because they were now classified as a luxury product and no longer on the priority list.
"We are still able to buy Chinese brands (which are awfully bad)," the unmarried 30-year-old wrote in an e-mail, "but even those are twice the previous price."