Pharma manufacturer eyes gains from trade with India

Open trade can benefit consumers as well: Getz Pharma.

KARACHI:

While most local pharmaceutical firms claim that without an effective drug regulatory authority and level-playing field, competing with India in open trade of finished medicines is impossible, one Pakistani company believes it will increase the industry’s export potential.

Getz Pharma, the largest exporter of Pakistani medicines, says open trade with New Delhi will benefit consumers and help Pakistani pharmaceuticals achieve global standards through joint ventures.

In the long term, Pakistan will benefit from liberalised trade with India, said Getz Pharma CEO Khalid Mahmood. Explaining his point, he said, India is a global pharmaceutical giant having 150 United States Food and Drugs Authority (FDA) validated plants. Bangladesh and Jordan for example, Mahmood said, have benefitted by acquiring technical assistance from FDA validated companies in India.

With a population of about 6 million, Jordan has four FDA approved plants, he said, adding Pakistan with a population of over 180 million doesn’t have even one such plant.

If India and Pakistan can do joint ventures, Mahmood said, the latter will benefit a great deal and even achieve global standards; not to mention increase its exports.

The $2 billion Pakistani pharma industry has an annual growth rate of 29% and exports $100 million worth of medicines to 60 countries.

Regarding competition, Mahmood said Getz Pharma is exporting generic medicines to 18 countries covering most of Far East, Africa and Asia. In most countries, he said, his company is beating its Indian counterparts. “If we can beat them outside Pakistan, there is no reason why we can’t compete with them in our own country,” he said. Furthermore, big Indian companies are not a real threat, he said, as they are targeting markets of North America, Europe, Japan and the Middle East for they get better price there.

But being a larger economy, India has advantage to manufacture cheaper medicines, a fact that can’t be ignored and rightly worries local pharmaceuticals who have invested millions in the industry.

However, cheaper imported medicines have not been able to capitalise the market so far. Pakistan has been importing Chinese medicines, the cheapest available, for the last 20 years but their market share in the country is hardly 1% in terms of value, Mahmood said.

Giving another example, he said Gideon Richter, a Hungarian company, has also been exporting cheap medicines, which are also manufactured in Pakistan, but their market share is not even 0.01% in terms of sales.

“If you don’t learn to compete, your consumer will be deprived of better quality and price,” he said. It’s the industry’s duty to become competent or it will be the loss of their consumers, he added.

Like Mahmood, an official from a leading multinational pharmaceutical, who requested not to be named, also said the number of pharmaceuticals is increasing but no one is paying attention to manufacturing standards.

Smuggling of spurious and substandard Indian medicines, the official said, can be controlled through increased surveillance. However, there is no surveillance system currently in place. There should be drug regulatory authority in place without which the industry will suffer, he said.

On the other hand, Pakistan Pharmaceutical Manufacturers Association (PPMA) has categorically demanded a ban on imports of finished medicines from India. PPMA Chairman and Global Pharma CEO Muhammad Asad believes that India will dump substandard - and possibly spurious – medicines to Pakistani market.

Large-scale manufacturing helps India make cheaper drugs, Asad said, and leaves the local industry – not yet ready for competition – with little profit margin, which will adversely affect the industry.

PPMA has already submitted its recommendations to Trade Development Authority of Pakistan’s (TDAP) special committee that has been tasked with  preparing sector specific reports regarding open trade.

According to Habib Nawaz, Staff Officer to Secretary TDAP, PPMA has recommended for Indian imports of raw material, medical equipment, packaging material, machinery and some medicines not manufactured in Pakistan, but demanded to place finished medicines in the negative list.

Published in The Express Tribune, November 27^th, 2011.