ISLAMABAD-Pakistan is taking steps to promote production of active pharmaceutical ingredients (APIs) locally through the use of innovative and efficient techniques in order to gain a competitive advantage for its pharma products in the global market.
A relevant official told WealthPK that out of the current 23 pharmaceutical companies, only five had the licence for basic manufacturing, which means they are authorised to produce APIs. “However, these companies manufacture only about 15% of APIs and the rest is imported,” the official added. He said 16 bulk medicament substances – APIs – are manufactured locally, adding that a majority of top national brands use these local APIs in their products. “Global API market spending currently exceeds $180 billion, and by 2024, it is anticipated to reach over $250 billion. Investments are direly needed in the industry due to its enormous potential and capacity to expand,” the official said.
“Investors are hesitant to develop API manufacturing facilities because of the intricacies involved int the process,” he said, adding due to its lucrative nature, many countries are investing in promotion and growth of their API industry. The official said that China, India and Bangladesh have taken the lead to incentivise this industry. “The government should extend both short and long-term incentives to encourage the production of pharmaceutical raw materials for the production of basic/semi-basic APIs,” he said.
The official said the Tariff Policy Board has called for a five-year exemption in customs duties on import of machinery, chemicals, including beginning and intermediate, for the basic and semi-basic manufacturing. “API producers can take advantage of funding options already offered under the State Bank of Pakistan’s Long Term Finance Scheme and Export Finance Scheme,” he said.
“API manufactures are being allowed to keep 15% of the FOB (freight on board) value of their export proceeds as export earnings,” the official said.
“Funding is being arranged from different national and international organisations to promote linkages between academia and basic/semi-basic API producers for associated research initiatives,” the official said.
He said establishment of API mega parks with all the necessary amenities such as power plants, distillation facilities and common waste and effluent treatment plants is also under consideration.
He said the ministry of production and industries would develop a strategy to reward naphtha cracking plants for advancing the fundamental chemical and pharmaceutical industries.
Pakistan’s pharmaceutical sector is less than $3 billion in size while the global market for medicines has reached $1.1 trillion.