Pakistan intends to increase annual pharma sector exports to $ 5 billion by 2025
1st Pharma Export Summit and Awards-2021 held
Pricing of drugs be taken away from the Health Ministry
Pharma industry is struggling due to lack of chemical industry
ISLAMABAD Sep 30,2021- Federal Commerce & Investment Adviser, Abdul Razak Dawood, has said the present government has been making efforts so that Pakistan’s annual pharma sector exports are increased to US $ 5 billion till the year 2025. The Adviser to Prime Minister on Commerce & Investment disclosed this plan of the government while addressing as the chief guest the 1st Pharma Export Summit and Awards-2021 (Pesa) organised by Pakistan Pharmaceutical Manufacturers’ Association (PPMA).
The PM’s Adviser informed the audience of the summit that the government has set an export target of $38 billion for the current fiscal year in consultations with the relevant stakeholders.
Dawood said more tariff rationalization will be done in the next budget in order to facilitate different industries including the farmers. The “made in Pakistan” marketing drive by the Ministry of Commerce is designed to promote Pakistan products in new markets which will greatly help increase the volume of pharma sector exports. He said that he has arranged a meeting of the PPMA leadership with the Prime Minister Imran Khan wherein all matters pertaining to the Pharma sector will be discussed.
He said that the government was committed to provide a conducive environment to all the segments of the economy and will make all efforts in removing the obstacles hindering pharmaceutical sector’s growth. He said that the exports of the engine of the economic developments.
He suggested that the pricing of drugs and other medical instruments should be taken away from the Health Ministry, adding that the ministry should also not deal with the commercial activities. He said that he has requested the PM Imran Khan that setting tariffs for the industry of the country should not be part of Federal Board of Revenue and now the ministry of commerce is dealing with tariffs.
He said that in tariff rationalization federal Minister for Finance Shaukat Tareen has greatly helped the commerce ministry. He added that the government will further rationalize the tariff in next budget for industry as well as for farmers.
Chairman Pesa and Former Chairman PPMA Kaiser Waheed speaking on the occasion said that some years ago the government was not considering the sector as an industry. However over the past 20 years situation has transferred and local industry started growing now the local industrial units have 70 percent market share. In 2000 the country was exporting just $9 million pharma products but now exports have crossed $250 million mark.
Chairman PPMA Tauqeer-ul-Haq giving the industry’s point of view said that in 2020 the pharma industry was valued at around $3.2 billion which ten years ago in 2011 was at around $1.64 billion. The industry can be $5 billion worth within next few years. He said that the industry recorded a 24 percent growth in first quarter of the current fiscal year as it exported over $68 million products.
Further highlighting the achievements of pharma industry he said that the sector has grown steadily over the years and without much help from the government. The worth of the pharmaceutical sector was estimated to be around $3.2 billion in 2020, showing an increase of 200 percent over a period of 9 years. Exports from this sector of the economy were worth $218 million in 2019, up from $44.4 million in 2003.
“Including institutional sales, industry posits that this sector easily becomes a retail market worth USD 4 billion,” a report titled ‘A Health Check for a Better Future: Unleashing the Potential of Pharmaceuticals in Pakistan’ states.
The industry is currently struggling due to lack of chemical industry in the country, poor governance, electricity shortages, inconsistence policies of DRAP regulator that cheery picks policies from world in the absence of a long-term drug policy, the report noted.
This above cited report was also of the view that global pharmaceutical markets are going through major restructuring due to the ongoing pandemic, presenting an opportunity for Pakistan to enter the global “off-patent drugs market” that will be worth $700 billion in branded generics and $381 billion in generics by 2025.
Pharma industry’s recommendations to the government
Considering these facts, the Pharmaceutical industry had made some viable recommendations to the government prior to the 2021 budget.
The industry recommended that the prices should not be regulated for drugs whose markets are competitive or monopolistically competitive. Price regulation should only be there in the case of a monopoly or collusive oligopolistic behavior.
The industry also suggested that the government allows duty-free imports of all APIs (active pharmaceuticals ingredients) and machinery for the both domestic and export market. This was granted in the budget as “to incentivize pharmaceutical products. CD and ACD has been exempted on 358 active pharmaceutical ingredients (APIs), the raw material of auto-disable syringes and Remdesivir.”