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Pharmaceutical industry of pakistan

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Naushii Khan
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Published on Apr 28, 2016

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 Pharmaceutical industry of pakistan

1. 1. GROUP # 9 JINNAH UNIVERSITY FOR WOMEN Assignment:PharmaceuticalIndustry of
Pakistan Subject: Analysis of Pakistan Industry Class:BBA 3 (B) Submitted to: Miss Qurat-ul-Ain
Submiton:16th April, 2016 • Nausheen Khan • Nuzhat Fatima • Syeda Umber Rehan • Rabia
Jamshaid Group Members 2016
2. 2. 1 ACKNOWLEDGEMENT We would like to express our gratitude first and foremost to our
Lord Almighty Allah for giving us the valor to remain dedicated to make this report. Writing this
report appeared to be great experience to us. It added a lot to our knowledge while we were
working on this report. If we say that this report is one of our memorable experiences in student
life, then it would not be wrong. For the successful completion of this report, we would also like
to thank our course instructor Miss Qurat-ul-Ain. Without her gratitude this report would not be
possible. Finally, we offer our heartiest gratitude to our family members for their selfless
blessings.
3. 3. 2 EXECUTIVE SUMMARY The pharmaceutical industry is divided into two sections i.e.
private and public sector. In 1947 there were only three manufacturing units located at Lahore,
 Rawalpindi and Peshawar. Pharmaceutical industries are highly competitive but fragmented
industry. They have complicated business model with numerous stakeholders. But they contribute
significant amount toward GDP. According to Pakistan’s pharmaceutical and healthcare survey
pharmaceutical industry contributes $1.6 billion towards GDP. Due to its significant contribution
towards GDP, government has put significant effort towards pharmaceutical industry
development. As a result of which Pakistan is the 8th largest pharmaceutical manufacturing
industry in world. These industries, however, face some problems like power shortage, lack of
trained manpower, difficulty in export, lack of new technology, changing political and economic
policies, bad law and order situation resulting in lower investment, higher interest rate and
terrorism which reflects foreign investors. Research and Development threats from cheap imports,
need of change in industry focus from import substitution to export oriented, local active
pharmaceutical ingredient 90% demand being imported, bio-availability and bio-equivalence are
some of the major challenges faced by pharmaceutical industry of Pakistan. The Pakistan
pharmaceutical industry is relatively well- known in the Developing Asian markets with an export
turnover of US$1 Billion as of 2013. Its main partners included neighboring Afghanistan which
itself doesn't have a medicinal industry. Currently Pakistan has more than 800 large volume
pharmaceutical formulation units running on world class high quality equipment’s, including those
operated by 25 multinationals present in the country.
4. 4. 3 TABLE OF CONTENT: 1.
Introduction……………………………………………………………………....... Pg.4 1.1. Global
Scenario of Pharmaceutical Sector………………………………… Pg.4 1.2. Pakistan Scenario of
Pharmaceutical Sector………………………………. Pg.4 2.
History……………………………………………………………………………… Pg.5 3.
Pharmaceutical Industry Characteristics………………………………………….. Pg.6 4.
Pharmaceutical Industry Contribution Towards GDP………………………….... Pg.6 5.
Companies Operating In Pakistan…………………………………………………. Pg.7 6. Benefits
of Local Pharmaceutical Manufacturing Sector………………………….Pg.8 6.1.
Direct…………………………………………………………………………Pg.8 6.2.
Indirect………………………………………………………………………. Pg.8 7. Growth of
Pharmaceutical Industry In The Economy of Pakistan……………….. Pg.8 8. Problems To The
Pharmaceutical Industry of Pakistan…………………………… Pg.9 9. Impact of Pharmaceutical
Industry………………………………………………… Pg.9 10.
Challenges…………………………………………………………………………..Pg.9 11. Needs
to be done………………………………………………………………… Pg.10 12.
Conclusion…………………………………………………………………………. Pg.11 13.
References…………………………………………………………………………. Pg.12
5. 5. 4 PHARMACEUTICAL INDUSTRIES OF PAKISTAN 1. INTRODUCTION:  What is
Pharmaceutical? A pharmaceutical is any kind of drug used for medicinal purposes, like cough
syrup or sleeping pills. You may have heard of a pharmacy, which is a place where you can buy
medicinal drugs, or a pharmacist, which is a person who prepares those drugs. In general, a
pharmaceutical is anything related to pharmacies or pharmacists, though it especially refers to the
kinds of medicines that they sell. Pharmaceuticals are often contrasted with what are called
recreational drugs, which are the illegal kind that are generally used for entertainment purposes
rather than to help heal the body.  Pharmaceutical industry in Pakistan: Pakistan Pharmaceutical
industry is growing at a very fast rate and contributing to the national economy. The mainstay of
public health is pharmaceutical sector in any country whether; it is developing or under
developing nation. The pharmacy profession and society are complementary and dependent on
each other for their development as a matter of fact. Pharmaceutical preparations are the integral
essential part of the health care system and best reward for the suffering people and society.
Pakistan has a very vibrant and forward looking Pharma Industry. The Pakistan Pharmaceutical
Industry meets around 70% of the country's demand of Finished Medicine. Pakistan is a
developing pharmaceutical market, with a large population and economic progress evident, but per
capita drug spending was rather low , The Pakistan pharma industry is relatively young in the
international markets with an export turnover of over US$ 100 Million as of 2007. Pakistan
Pharma Industry boasts of quality producers and many units are approved by regulatory
authorities all over the world. Let’s have a look to the global and Pakistan scenario of Pharma
Sector.
6. 6. 5 1.1. Global Scenario of Pharmaceutical Sector The global pharmaceutical market is valued at
not less than 440 billion US dollar with 60% annual growth by World Trade Organization (WTO),
whereas, independent studies reveal that this would be more than 600 billion US dollar in 2010.
Global pharmaceutical market is assessed to be more than double in value up to l trillion US dollar
by 2020. 47% market of pharmaceutical business revolves around North America which is more
than 206.8 billion dollar. The gross national income of USA is about 25000 US dollar per annum.
Likewise, 170 market of pharmaceutical business revolve around Japan with 48.4 billion dollar.
1.2. Pakistan Scenario of Pharmaceutical Sector Looking at the Pakistan Pharmaceutical market, it
is very competitive and challenging. About 600 Pharmaceutical companies are operating in
Pakistan. Out of these companies 386 are operating units. The population of Pakistan is not more
than 2.7%o of the total population of the world with 1.5 billion US dollar market size. The gross
national income per person (GNP) of Pakistan is much less than 5000 US dollar per year as per
report of world Bank (2002).World Health organization in its study. ”World Medicine Situation”
reports, that Pakistanis are spending 71% of their healthcare budgets on buying medicines' This
shows the lack of government public health financing (Pakistan is spending on an average a mere
0.5-0.8 per cent of the GNP on health.
7. 7. 6 2. HISTORY The Pakistan pharmaceutical sector has come a long way, being almost non-
existent before early seventies to a prominent provider of healthcare products, meeting almost
95% of the country’s pharmaceuticals needs. The pharmaceutical industry is divided into two
sections i.e. private and public sector. In 1947 there were only three manufacturing units located at
Lahore, Rawalpindi and Peshawar. In the early years of independence the country’s requirements
were met exclusively through imports of finished products. The discovery of antibiotics,
tranquilizers etc. changed all the dynamics and Pakistan had to import these new expensive
medicines from western countries and sold them locally. This caused a severe drain of foreign
exchange allowing government to think and plan about pharmaceutical industry. The government
of that time suspended the import licenses of pharmaceutical products under open general licenses.
A few pharmaceutical industries were authorized to operate in Pakistan. A Colombo Plan Mission
of pharmaceutical experts toured the country and made observations regarding the absence of
adequate quality control, lack of proper equipment and scarcity of trained personnel in the existing
manufacturing facilities. Currently Pakistan has more than 800 large volume pharmaceutical
formulation units running on world class high quality equipment’s, including those operated by 25
multinationals present in the country. The Pakistan Pharmaceutical Industry meets around 90% of
the country's demand of finished dosage forms and 4% of Active ingredients. Specialized finished
dosage forms such as soft gelatin capsules, parenteral fat emulsions and Metered-dose inhalers
continue to be imported. The Pakistan pharmaceutical industry is relatively well-known in the
Developing Asian markets with an export turnover of US$1 Billion as of 2013. Its main partners
included neighboring Afghanistan which itself doesn't have a medicinal industry, Tajikistan as
well as other central Asian republics. In the past, Sri Lanka used to be Pakistan's biggest medicinal
importer however trading volumes have recently slightly subsided. Now more companies are
having interest in investing in Pakistan's medicinal Industries. Companies like Merck, Abbott and
GlaxoSmithKline have reported a great increase in profits in 2013. The pharmaceutical industry in
Pakistan made its entry in to the online space through Sehat.com.pk in April 2014.
8. 8. 7 3. PHARMACEUTICAL INDUSTRY CHARACTERISTICS  Highly Competitive but
Fragmented industry.  Complicated business model with numerous stakeholders.  Very
Technical/Scientific products.  Major R&D expenditures and High Risk product development
environment.  Long Product-Development Timelines.  Long Marketing-Planning horizons. 
Highly regulated industry and highly regulated marketing communications by FDA.  Primary
targets: Healthcare Professionals and Consumers.  Numerous “customers” with variety of
information needs requires multiple approaches to creating marketing campaigns and
communications.  Evolving selling environment.  Use of e-channel still in its infancy in our
industry. 4. PHARMACEUTICAL INDUSTRY CONTRIBUTION TOWARDS GDP The
Pakistan pharmaceutical sector has come a long way, being almost non-existent before early
seventies to a prominent provider of healthcare products, meeting almost 95 per cent of the
country’s pharmaceuticals needs. The Industry today tops the rank among Pakistan’s scientific
research based industries with wide ranging capabilities in the complex field of drug
manufacturing and technology. It ranks very high in the third world, in terms of technology,
 quality and range of medicines manufactured. From plain painkillers to sophisticated antibiotics
and complex cardiac compounds, almost every type of medicine is now made indigenously.
9. 9. 8  Pharmaceutical industry contribute significant amount toward GDP.  According to
Pakistan’s pharmaceutical and healthcare survey pharmaceutical industry contributes $1.6 billion
towards GDP.  Due to its significant contribution towards GDP, government has put significant
effort towards pharmaceutical industry development.  As a result of which Pakistan is the 8th
largest pharmaceutical manufacturing industry in world.  With 40 biotechnology companies,
involved in development and manufacturing of various drugs.  Pharmaceutical sector is one of
the most developed hi-tech sectors in Pakistan.  New pharmacy schools have been set up all
across the country to provide quality education to the students of pharmacy. ROLE OF
GOVERNMENT: Pakistan Health ministry is considering toconstitute a committee comprising of
the World Health Organization, Pakistan pharma and health ministry to keep check on the quality
of drugs available in the market. According to statistics by ministry of health 41.2% of the
Pakistani population cannot afford procuring medicines due to high prices in the country. In the
biotechnology sector, Pakistan has initiated manyprograms. It is planning to set up biotechnology
plant worthprograms. It is planning to set up biotechnology plant worthRs.400 million to meet the
growing needs of qualityRs.400 million to meet the growing needs of qualitymedicines in the
country. The move is being taken in the field of medicine by theprivate sector in collaboration
with investors The plantprivate sector in collaboration with investors The plantwould start
production within the next few years. Severalwould start production within the next few years.
Severalcountries have expressed keen interest to invest in Pakistancountries have expressed keen
interest to invest in Pakistandue to the pro-active policies of the government. haveWhile
substantial increases in public sector spending havebeen witnessed in recent years. toSome major
public sector programs have been initiated toaddress the healthcare needs of the population.
Theseaddress the healthcare needs of the population. These include: The National Program for
Family Planning and Primary Health Care. The Expanded Immunization Program. National
Program for Hepatitis Prevention National Tuberculosis Control Program. National Malaria
control Program.
10. 10. 9 National HIV/AIDS Control Program. Women's Health Program. The government has also
formed a policy recently The government has also formed a policy recentlyallowing companies to
produce raw materialsallowing companies to produce raw materialslocally. Companies in Pakistan
rely heavily onlocally. Companies in Pakistan rely heavily onChina, India, Germany, UK and
Japan for rawChina, India, Germany, UK and Japan for rawmaterial imports.material imports. 5.
COMPANIES OPERATING IN PAKISTAN There are 30 multinational and 334 national/local
pharmaceutical companies in Pakistan. TOP 30 COMPANIES OPERATING IN PAKISTAN 1
Glaxo Smith Kline 16 Werrick 2 Abbot+Knoll 17 Wilson 3 Pfizer 18 Getz 4 Aventis 19 Highnoon
5 Novartis 20 Barret Hodgson 6 Merck Marker 21 ICI 7 Searle 22 Reckitt Benkiser 8 Wyeth 23
Platinum 9 Roche 24 Macter 10 Bristol Myers Squibb 25 Janssen 11 Hilton 26 Eli Lilly 12 Sami
27 Schering AG 13 Ali Gohar 28 CCL 14 Merck Sharp Dohme 29 Bosch 15 Nestle 30 Himont
11. 11. 10 Direct Indirect 6. BENEFITS OF LOCAL PHARMA MANUFACTURING SECTOR 6.1.
DIRECT  Self-Reliance.  Foreign exchange saving.  Employment generation.  Employment
for Females.  Skill Up gradation.  FDI.  Transfer of Tech. & Know How.  Critical Support in
Man Made & National disasters. 6.2. INDIRECT  Indirect employment.  Investment.  Skill
Acquisition.  Technology Spillovers.  Brain Drain Reversal. 7. GROWTH OF
PHARMACEUTICAL INDUSTRY IN THE ECONOMY OF PAKISTAN  The growth of the
country's pharmaceutical industry has dropped from approximately 16 percent per annum to
around eight percent per annum which is a cause of concern not only for the industry but
government as well. Industry sought a predictable and transparent regulatory environment which
included a proper system for registration of drugs and clearing up the ever-increasing backlog. 
The pharmaceutical industry in Pakistan is subject to the most stringent regulatory control, in
particular price controls. This is the reason companies are leaving Pakistani market as 10 years
ago there were 36 MNCs operating in Pakistan and today there are just 24.  The latest company
to exit Pakistan was Johnson & Johnson. 'Their "sutures" manufacturing facility has been shut
down and the product is now imported from Dubai at a higher price. The result is loss of
investment, precious jobs and increase of the import bill.
12. 12. 11 8. PROBLEMS TO THE PHARMACEUTICAL INDUSTRY OF PAKISTAN  Power
shortage.  Lack of trained manpower.  Difficulty in export.  Lack of new technology. 
Changing political and economic policies.  Bad law and order situation resulting in lower
investment.  Higher interest rate.  Terrorism which reflects foreign investors. 9. IMPACT OF
PHARMACEUTICAL INDUSTRY  The developing country like Pakistan, where one percent
of the population suffers from severe and 10 per cent from mild mental disorders and the social
issues of depression and anxiety are manifold.  The prevalence of depression in the general
population in Pakistan has been reported to be from 10-25 percent in males and 25-66 percent n
females and the total population suffering is 60 percent depression, 14.5 percent schizophrenia, 29
per cent psychosomatic disorders.  The unavailability of high quality, safe and efficacious drugs
will pave way for counterfeiters, black marketers and spurious drugs to flood the local market.
This will endanger the lives of many patients putting at risk their health and treatments.
13. 13. 12 10. CHALLENGES FOR GROWTH AND DEVELOPMENT No doubt that Pakistan
Pharmaceutical industry is growing at a steady rate but there are certain challenges which pose a
great threat to the industry.  The first major challenge which the Pharma Industry faces is the
total government control on the prices of all the enlisted products.  Import of raw material which
costs a lot of precious foreign exchange.  Rapid devaluation of the rupee against the major
currencies, due to which the profit margins are shrinking.  Increasing cost of manpower and
energy.  Low R&D expenditure, which can lead to the suffering of masses for not conducting
sufficient research on the newly emerging disease in the Pakistani environment.  Political
instability is another major factor which is emerging as the major challenge to the pharma
Industry, because of discontinuation of the policies.  Last but not the least, the deteriorating law
and order situation, due to which most of companies have suffered in terms of sales and also lack
of reach to the customers in the affected areas.  Market access is challenging and operational
risks are high.
14. 14. 13 11. NEEDS TO BE DONE  Synergies the strength of Pakistan Pharmaceutical Industry
and Publicly funded R&D institution.  Create an enabling infrastructure and linkage to facilitate
Pharmaceutical Industry to improve process technique.  Stimulate skill development of Human
Resource in Pharmaceutical R&D.  Enhance nation’s self-reliance in drugs and pharmaceuticals,
especially in areas of national health requirements.  Provide technical support to pharmaceutical
companies for export.
15. 15. 14 12. CONCLUSION Pharmaceutical sector is one of the most developed hi-tech sectors in
Pakistan The growth of the country's pharmaceutical industry has dropped from approximately 16
percent per annum to around eight percent per annum which is a cause of concern not only for the
industry but government as well. There is a need of publicly funded R&D institution. Pakistan has
to create an enabling infrastructure and linkage to facilitate Pharmaceutical Industry to improve
process technique. It is needed to stimulate skill development of Human Resource in
Pharmaceutical R&D and to enhance nation’s self-reliance in drugs and pharmaceuticals,
especially in areas of national health requirements. Providing technical support to pharmaceutical
companies for export is also necessary.
16. 16. 15 REFERENCES  http://www.rcci.org.pk/wp-content/uploads/2012/12/SWOT.pdf 
http://prr.hec.gov.pk/chapters/3068h-1.pdf 
https://en.wikipedia.org/wiki/Pharmaceutical_industry_in_Pakistan 
http://www.slideshare.net/sherazpervaiz/pharmaceutical-marketing-paf-kiat 
http://www.answers.com/Q/How_many_pharmaceutical_companies_in_pakistan 
http://pu.edu.pk/images/publication/PPI_in_WTO_%20regime-Issues_and_Prospects.pdf 
http://health-asia.com/conferences/2014/Presentations/Day1/PharmaConvention/02- Nasir-
javaid.pdf  http://www.pcsir-lhr.gov.pk/Pharmaceutical-Seminar/Technical- SessionI/Dr.
%20Abdul%20Hafeez%20Pharmaceutical%20Industry%20in%2021st%20C entury.pdf 
https://hmzakazi.wordpress.com/2012/03/10/history-of-pharmaceutical-industry-in- pakistan/ 
http://www.brecorder.com/business-and-economy/189:pakistan/1195160:growth-of- pharma-
industry-drops-to-8-percent-from-16/?date=2015-06-12 
http://www.pakistantoday.com.pk/2012/04/17/business/pharmaceutical-industry-could- do-with-
some-anti-depressants/  http://www.slideshare.net/SamiSwati/role-of-industries-in-the-economy-
of-pakistan
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