An Overview of Pakistan Pharma Industry - Tribute To Senator Abdul Haseeb Khan

Tanzeel ur Rehman Pakistan has a very vibrant and forward looking pharma industry. At the time of independence in 1947, there wa pharma industry in the country. Today Pakistan has about 400 pharmaceutical manufacturing units including thos by 25 multinationals present in the country. The Pakistan pharmaceutical industry meets around 70 per cent of th demand. The domestic pharma market, in terms of market share is almost evenly divided between the national c and multinationals. The industry provides direct employment to over 70,000 and indirect employment to around 150,000 across the National pharma industry has shown a progressive growth over the years, particularly over the last one decade. T has invested substantially to upgrade itself in the last few years and today the majority industry is following Good Manufacturing Practices (GMP), in accordance with the domestic as well as international guidance. Currently the i the capacity to manufacture a variety of products ranging from simple pills to sophisticated biotech, oncology and added generic compounds. Although Pakistan's pharmaceutical and healthcare sectors are expanding and evolving rapidly, about half the po no access to modern medicines. Clearly this presents an opportunity, but much more work needs to be done by t government and industry stakeholders. The value of pharmaceuticals sold in 2007 exceeded $1.4 billion, which e capita consumption of less than $10 per year and value of medicines sold is expected to exceed $2.3 billion by 20 Pakistan is a developing pharmaceutical market, with a large population and economic progress evident, but per spending was rather low at around $9.30 in 2007. Private spending accounts for 65 per cent of total healthcare e sourced through out-of-pocket payments, international aid and religious or charitable institutions. Pharmaceutica accounts for less than 1 per cent of the country's GDP, comparable to levels in some neighbouring countries. The period is likely to witness the marginal strengthening of the generics sector, albeit more in terms of volumes than share of generics is also likely to increase further as major drugs come off the patent in the near term, to the like the generics-dominated local industry. The Pakistan pharma industry is relatively young in the international markets with an export turnover of over $10 of 2007. Pakistan Pharma Industry boasts of quality producers and many units are approved by regulatory autho the world. Like domestic market the sales in international market have gone almost double during last five years. industry is focusing an Export Vision of $500 million by 2013. In the meantime, exports are also likely to boost du regional and global opportunities. The Pakistan Pharmaceutical Industry is a success story, providing high quality essential drugs at affordable price Technologically, strong and self reliant national pharmaceutical industry is not only playing a key role in promotin sustaining development in the vital field of medicine within the country, but is also well set to take on the interna markets. The country's pharmaceutical exports were $101 million in 2006-07 and growing at an annual rate of 22 per cent exports hit the mark of $83 million. Export target for FY2008 had been projected at $125 million. On the other side of the border, Indian pharmaceutical exports stand at $6 billion, growing at a pace of 20 per ce Country's spending on health as percentage of GDP was only 0.8 per cent as compared 5-6 per cent in Sri Lanka, cent in Bangladesh, 6-7 per cent in Algeria, 5-7 per cent in Mexico, 6-9 per cent in Iran and 10-15 per cent in Co Cuba. Economy contribution and Importance Being one of the major indicators of economy, pharma industry has contributed positively so far and has someho to increase production by a meager 1 per cent. Similarly industry contribution and weightage surged to 6.7 per c Large Scale Manufacturing (LSM) production during 1QFY09. On the other hand, LSM posted 6.20 per cent negative growth in 1QFY09 over the corresponding period of previo mainly due to deteriorating economic of the country. Challenges The fast-deteriorating business environment especially for the pharmaceutical companies in the wake of high cos production has been burdening the local pharma sector. Also, the cap on drug price by the government for the last seven years has aggravated the situation further. Last

increase, which was of 3 to 4 per cent, was allowed by Ministry of Health in December 2001. The prices of the Active Pharmaceutical Ingredients (APIs) used for the manufacturing of drugs as well as of othe materials like paper, plastic, glass, rubber, etc. have increased manifold since 2001. The cost of oil, gas, electrici transportation and labour has also spiked dramatically during this period. Bristol-Myers Squibb (BMS) has an annual turnover of around Rs 1.5 billion and is the second multinational pharmaceutical, which is going to kiss Pakistan goodbye. Earlier, Merck Sharp & Dohme (MSD) closed down its op Pakistan some months back and was acquired by a local pharmaceutical firm Organon Bio Sciences (OBS). "It is not the end but a new beginning for the pharmaceutical firms", said a pharma industry lynchpin. "Especially shutting down business because of tough business conditions," added he. He also pointed out that more and mor mulling to close operations in Pakistan. "After MSD and BMS, two more firms will follow suit in the near future," he said and added that the local pharma companies are also facing hard times as well and they are opting for mergers to survive in the present situation. local pharmaceutical companies Hilton Pharma and SAMI Pharmaceutical consolidated their operations in order to the current situation.