Pakistan Pharma Industry SWOT – Part 14 – Asrar Qureshi’s Blog Post #605

Pakistan Pharma Industry SWOT – Part 14 – Asrar Qureshi’s Blog Post #605

Dear Colleagues!  This is Asrar Qureshi’s Blog Post #605 for Pharma Veterans. Pharma Veterans welcome sharing of knowledge and wisdom by Veterans for the benefit of Community at large. Pharma Veterans Blog is published by Asrar Qureshi on WordPress, the top blog site. Please email to asrar@asrarqureshi.com for publishing your contributions here.

Opening Note

February 2022 marks my completing 47 years of working in Pharma Industry. Allah be praised. I am still working. The first half of my working career was spent in Multinational companies, and the latter half in the Local Pharma, making me well-versed with both innovators and generics markets. I also had the opportunity to work in business as well as operations. 

My journey of near half century is also the journey of Pharma Industry in Pakistan. Great changes have occurred in this time and a lot could be written about it. In my blogs, which were started about four and a half years ago, I have covered several topics related to Pakistan Pharma Industry. This multi-part series shall do and review the SWOT – Strengths, Weaknesses, Opportunities, Threats – of the Pharma Industry.

SWOT – WEAKNESSES……

As mentioned in the introduction of SWOT, Strengths and Weaknesses are internal while Opportunities and Threats are external.

Another point to mention is that my focus is mostly on Local Pharma which is dominating the Pharma Industry since many years. 

3. Vision of Future – Witnessing the history, it is apparent that barring a handful of companies, none of the Local Pharma carried any vision about future. Greatest majority of Local Pharma started small and did everything outside the book to survive. As revenue increased, some thought about developing the organization, many others did not. In the local market, out of 750 manufacturers, probably 100 are engaged in proper marketing, brand building, and working like organizations. Rest are engaged in government business at all costs, wholesale business, franchising, trading etc. In this scenario, the vision for future seems like a far-fetched idea. Money drives every thought and action.

Lack of vision is also amply evident from Local Pharma intent and effort to go out and do international business. Few companies, may be less than 50, are pursuing export business. Even fewer are setting up teams in other countries for promotion of their products. Traditional model was to find a distributor and sell to him at low prices and let him do whatever he wanted. Getz deviated from it and started putting up their own sales and marketing infrastructure in other countries, on the pattern of MNCs. They created a greatly successful model which motivated few other companies also. However, the number of companies venturing into it seriously is still very small. Except CCL, no one dared to put up manufacturing unit in another country. 

The world became global village a long time ago. Organizations in our neighboring India and Bangladesh moved faster and went out in the world while we are still not considering going transnational. 

Lack of vision is also evident from lack of reinvestment into manufacturing facilities, developing modern facilities for biological products, manufacturing of basic materials, and so on. Our Local Pharma chooses to live in the present only with utter disregard for what will come in future.

4. Conventional Formulations – Though Local Pharma has aggressively marketed generic versions of latest research products; the formulations still follow the conventional pattern. Every drug formulation has one/two active ingredients and several inactive ones which ensure timely disintegration, dissolution, and absorption. We may say their formulation is optimized for compatibility of ingredient and to provide optimum efficacy and safety. The innovator formulations are protected by patents and are not available in public domain. Generic formulations are still designed on traditional pattern where same inactive compounds are used for multiple drugs; the concept of optimization is not applied in general. Since comparative studies are not done, it does not become clear which generic formulation provides optimum efficacy.

It is also pertinent to note that the formulations may greatly vary between various manufacturers, and there may be a tendency in smaller companies to cut costs.

5. API Manufacturing – Active Pharmaceutical Ingredients – APIs are the essential and unvarying component of all drugs. These may also be major part of the cost of product. Pakistan imports over 90% of APIs mainly from India and China, thereby consuming lot of foreign exchange, and having no control on the API prices. API manufacturing in Pakistan started in late 1980s and presently more than 10 companies are manufacturing APIs, but these are no more than 20 products. APIs produced in Pakistan have following points of concern.

a. Not all locally produced APIs are manufactured from the basic; they may start in the middle and complete few last steps.

b. Prices of locally produced APIs are almost the same, or somewhat higher, thereby not providing price benefit of local production.

c. Tariff protection is granted to local API producers which makes importing the same materials more expensive.

d. Capacities are limited and, in many cases, insufficient to fully cater to local demand.

e. The same materials are produced by multiple manufacturers, not adding much to the list.

Pakistan Pharma industry has seriously lagged in API manufacturing because it is a longer, more arduous process. It has happily followed finished products production which is easier and takes shorter time. Government policies are also to be blamed for not encouraging API production. Non-production of APIs locally lends great deal of weakness to Local Pharma.

6. Quality – perhaps the most burning question for public is the quality of generic products produced locally. Various news, rumors and ideas fly around, largely blaming Local Pharma for selling poor quality drugs. This perception must be contested because it is not true. All manufacturers, and I repeat, all manufacturers produce quality which conforms to their standards. Quality may still vary due to following three factors.

a. Quality of components may vary. Various pharmacopeial grades are available with the suppliers which ensure conformance but may vary in finer detail and may have bearing on the ultimate performance of the drug.

b. Optimization of formulation is not done specifically, thereby affecting the performance of finished drug.

c. Manufacturing machines quality, model, make, age varies thereby affecting the performance of the drug

These variations may be minor individually but may have significant effect collectively. This should also explain the common perception that imported drugs work better than locally manufactured one.

Quality, as emphasized now, is extended over all areas of pharmaceutical manufacturing. Quality By Design – QbD concept means that quality is embedded in the design foundation of everything. From plant layout to equipment to procurement to formulations to quality testing to warehousing, and everything in between. Quality is not just the responsibility of Quality Control and Quality Assurance, but it is everyone’s responsibility. Another requirement is that the Head of Quality should report directly to the top so that he/she may not be influenced by anyone to compromise on quality.

Adherence to international quality standards is not uniform among Local Pharma. Some take it very seriously and strive constantly to upgrade while some others try to make do as much as they can. This is a weakness of Local Pharma which is likely to have negative impact on their long-term competitiveness at home and abroad.

To be Continued……

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