Pharmaceuticals is highly fragmented market, capital intensive industry and cost of doing business is very high-Javed Ghulam Mohammad


Proceedings of 5th Pakistan Pharma Summit-IV
Pharmaceuticals is highly fragmented market,
capital intensive industry and cost of doing
business is very high-Javed Ghulam Mohammad
Regulatory environment in Pakistan is getting stringent every day

ISLAMABAD: Global pharmaceuticals market size in 2019 was US$ 1.25 Trillion and it has a growth of 5.5%. Almost 44% of this market is in North America, 11% in Canada, Japan has 6%, China 6%. Most of the growth in Pharmaceuticals has been witnessed in China, Brazil and India. The Top Ten therapeutic areas include cardiology, anti-diabetics, anti-rheumatics, vaccines. Pfizer, Novartis and Roche are the leading pharmaceutical companies in the world. The top thirty companies are from United Sates and there is none from China and India. Eleven are from Europe. This was stated by Mr. Javed Ghulam Mohammad Group Managing Director and CEO Martin Dow Group while making a presentation in the second session of the 5th Pakistan Pharma Summit organized by PPMA held here on February 19, 2020. He discussed in detail the growth strategy for Pharma Industry.

Speaking about the Pakistani pharmaceuticals market he said that it was US$ three Billion. Pakistan has one of the lowest per capita pharmaceutical consumption which is less than Bangladesh, Philippines and Indonesia. In Pakistan regulatory environment is getting stringent every day. It is highly fragmented market, capital intensive industry and cost of doing business is very high. Generic market has expanded. Governments are the main driver in many countries as they purchase the drugs. Pakistan Pharma industry imports almost 90% of APIs. Fuel prices has registered between 60-70% increases during 2017-2018. The devaluation of Pakistani currency has been between 40-50% during 2017-2019 which has increased the cost of raw material. Gas prices has also registered 50-60% increase during the same period.

Mr. Javed Ghulam Mohammad Managing Director and CEO Martin Dow Group and Mr. Hanif Ajari from Getz
photographed in a jovial mood during the Pharma Summit 2020.

For growth strategies for the Pakistan Pharmaceuticals Market, he suggested expanding the product portfolio, Geographical expansion, going for Mergers and Acquisitions, Diversification besides digital transformation. The industry should enter niche and specialized segments which includes Oncology, Biosimilars, Hormones, Blood plasma products and monoclonal antibiotics. Pakistani pharmaceuticals market has been growing at a rate of 15.6%. Currently there are six hundred forty drug manufacturers in Pakistan as compared to just two hundred fifty seven in Bangladesh. In view of the largest number of pharma companies operating in Pakistan, there is lot of competition. We need to target emerging and developed markets. There is tremendous potential for expansion. We must embark upon aggressive growth strategy to meet the challenges. Prevalence of Cancer is increasing in Pakistan. With government support, we should get plants approved for international export. We also need to change our mindset about quality and do some investment. In fact lot of investment is needed. We must keep in mind the ICH guidelines during product development. Also keep in mind the patents which are going to expire in near future and plan development of Generics. APIs and the manufacturing process is also registered. One cannot change the AIPI. In Pakistan API is not registered. We need to study the pharmaceutical dispensing practices and also study the business model of each country. In some countries pharmacists play a vital role and in some it is the insurance companies which are driving the pharmaceutical business.

He also suggested upgrading the pharmaceuticals plant to international standards, going for robust formulation development, understanding the intellectual property rights and patent protection. We need to base our business model keeping in view the dynamics of each market i.e. Branded Generics market, Generic generics market, market controlled by insurance companies and the markets driven by distributors and other trade channels. We need to improve market share and also improve company performance. Go for diversification for high growth. Manufacturing integration is difficult and it needs proper planning. He also highlighted the role of Contract Research Manufacturing, Contract Research Organizations and opined that CRAM was the future.

Continuing Mr. Javed Ghulam Mohammad said that Global API market was valued at US$ 165.7 Billion which is expected to increase up to US$ 236.7 Billion by 2024. There are business opportunities in API because of market driven by increase in infections, Genetic disorders. Neutraceuticals and Health Supplements was yet another market with lot of potential. It includes Vitamins, Minerals and Supplements, Cough, Cold and Allergy products, Dermatological products, gastrointestinal drugs besides the lifestyle OTC products. He also highlighted the challenges and opportunities of pharmaceutical industry in the age of Digital Transformation and the importance of cyber security which was extremely important.

Dr. Zaheeruddin Baber, M. Zaka Ur Rehman Chairman PPMA and Mr. Haroon Qasim photographed during the
5th Pakistan 
Pharma Summit held at Islamabad during February 2020.

Panel Discussion
on Pharma Export

This was followed by a panel discussion on Pharma Export. Members of the Experts Panel included Mr. Tariq Ikram former Minister of State and Chief Executive of Trade Development Authority, Mr. Zahid Saeed Managing Director Indus Pharma, Ms. Nusrat Munshi Managing Director AG Pharma, Mr. Hamid Raza CEO Neutro Pharma, Mr. Hanif Ajari Director Export Network and Company Secretary Getz Pharma and Mr. Tauqeer ul Haque Managing Director Sante. Mr. Ali Khizar Aslam Head of Research in Business Recorder acted as the moderator.

Initiating the discussion Mr. Hanif Ajari said that some of the challenges that we face include that the industry need to change its mindset. We must find out where we can grow. Corporate Dossiers should be strong. We must follow the ICH Guidelines which acts as a Visa. Then we have to apply and it takes almost about two years before you are allowed to export. In order to compete and enter the export market we had to make an investment of thirty five billion rupees. It has paid dividends and now we have received orders which we are worried whether we will be able to meet. Speaking in his typical entertaining style, Mr. Hanif Ajari said that he was glad that at least the Pharmaceuticals as a Sixth Child of the Government has now born. The authorities now realize the importance of moving away from its traditional export items like Sports Goods, Surgical Instruments, Carpets, Textiles, Rice and Leather goods. It has now recognized the Pharmaceuticals as its sixth child but it must be treated at par with other children. If pharmaceutical industry is provided facilities and needed support in getting Certification etc., we are capable of increasing our exports manifold.

Mr. Zahid Saeed and Mehwash Tariq Siddiqui presenting mementoes to Mr. A. Latif Sheikh, Mr. Arshad Mahmood
and Dr. Shahzad, at the 5th Pakistan Pharma Summit organized by PPMA at Islamabad during February 2020.

Ms. Nusrat Munshi pointed out that ten years back, Pakistan was ahead of Bangladesh but no more. We should have found out resources, allocated them to achieve the desired objectives. She laid emphasis on collaboration between the pharmaceutical industry and the Regulatory authorities. Now drug evaluation process has been streamlined but the industry was still facing difficulties as regards drug prices. Pricing formula must be structured and it should be with the DRAP not the Cabinet. In many countries only essential drug prices are controlled and the rest is determined by supply and demand mechanism. We need to follow that if we have to make some worthwhile progress and development in the field of pharmaceuticals.

Mr. Zahid Saeed said that we do not need Bioequivalence in many drugs. For solid dosage form, we can get waivers. However, we do need more human resource and investment. The pharmaceutical industry must spend more in human resource but it is very scare in Pakistan. We have few places where we can avoid the laws. We can export dermatological products, other drugs and preparations needed to look good. Once a company has got ISO 13485 certification, many such drugs and preparations can be exported to many countries. We are exporting to Europe some skin preparations. He reminded the audience that rules of the game keep on changing hence it is important that we are aware of it.

Mr. Tariq Ikram suggested that the Government officials and the representatives of the pharmaceutical trade and industry need to sit together and analyze what we can export. Government was not aware of our potential. There was no clarity on which sector we need to focus. We have identified pharmaceuticals in the Year 2000 and at that time our drugs exports were just nine to ten million US dollars. No pharmaceutical product from Pakistan was registered outside Pakistan. In the Year 2008, we got eighty four drugs registered overseas and fourteen pharmaceutical companies started exporting drugs and soon we were exporting drugs worth forty six million US dollars. Industry started doing research. We need motivated people. He was of the view that the government need to reduce duties and sales tax on import of raw material. The industry must be allowed tax free export or reduce all the taxes for exports. He was of the view that Pakistan Pharmaceutical industry has the potential to export drugs worth 5.4 Billion dollars. How we can achieve that is by energizing and motivating the industry.

Photographed during the 5th Pakistan Pharma Summit organized by PPMA at Islamabad during February 2020 from
(L to R) Mr. Haroon Qasim MD PharmEvo, Prof. Abdul Bari from Indus Hospital, Mr. Shaukat Ali Jawaid Chief Editor
PULSE International and Mr. Hamza from Terribiz the event organizer who had organized the Pharma Summit 2020.

Mr. Hamid Raza said that we need to increase the number of state of the art drug manufacturing units. We have made lot of progress and now many such units are operating in Pakistan. At present Pakistan’s share of the global pharmaceutical market was just 0.2%. Pharmaceutical industry, DRAP, Ministry of Commerce need to sit together and find out how it has happened and how we have reached there. Pharmaceutical industry, he said, has failed to invest in human resource and upgrading the manufacturing facilities. We need Certification. We need to have more FDA approved drug manufacturing units in the country. We need international accreditation. He also suggested that let the pharma industry and DRAP representatives sit together and find out how we can promote this industry.

Mr. Tauqeer ul Haq said that let us find out in which direction we need to move to increase our exports. Image of Pakistan pharma industry is very high in many countries. In Exports competition is very tough. We have to be cautious. We are doing exports by providing cost effective drugs but we have to be mindful of our image and quality of drugs. We do not require certification for Biosimilars which can be exported. Let us identify the potential of the market, select the molecules which are important like injectable and skin preparations. DRAP, Government, pharmaceutical industry must make a joint effort to achieve our targets. He also suggested that all duties, taxes on exports should be eliminated. There should be no duties on import of equipment and to achieve that consistent efforts by the industry are needed.

Mr. Asim Rauf Chief Executive of DRAP said that pharmaceutical industry is a vital segment which can play an important role in Pakistan’s development. It is growing and we have a potential of exporting drugs worth five billion US dollars. We could not achieve that. We have not exported to developed world. WHO and FDA were encouraged to visit Pakistan. We are exposing ourselves fearlessly to the international auditors. We have taken certain initiatives to have professional environment ensuring honesty, transparency and providing professional working environment. We started working on PICS and WHO certification. We have started digitalizing our standards. If India and Bangladesh can achieve some targets, why cannot we, he asked? He promised that DRAP will provide export conducive friendly environment and the pharmaceutical industry will be encouraged to fill up the gaps so that we can go to the developed market. For increasing exports, we have to work together. Quality must be maintained and if we manage all this, Pakistan’s acceptance will improve overseas.

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