Status of Pharmaceutical Business in Pakistan 2024 – Part II – Asrar Qureshi’s Blog Post 962

Status of Pharmaceutical Business in Pakistan 2024 – Part II – Asrar Qureshi’s Blog Post 962

Dear Colleagues! This is Asrar Qureshi’s Blog Post 962 for Pharma Veterans. Pharma Veterans Blogs are published by Asrar Qureshi on its dedicated site https://pharmaveterans.com. Please email to aq.pharmaveterans@gmail.com for publishing your contributions here.

Credit: Kübra Kuzu

Credit: Polina Tankilevitch

Credit: Tran Nhu Tuan

This is the second and last part.

Corporates Growth

Pakistan market is extremely unevenly divided with about 95% market share with only top 100 companies. The top players added further huge revenues to their already bursting volumes. They have also further strengthened their positions by increasing share of the total market. The top players have done this by growing at a rate higher than the market growth. How are they able to do it? There are several factors.

Human Resource – The big players have the financial strength and market standing to attract top talent. Once acquired, the talent prefers to stay there because they are not likely to get better deals elsewhere. Working together over longer periods brings in team spirit and cohesion. The overall performance is enhanced further. The big players take care of their talent pool and prevent it from going away. Smaller players suffer on two counts: one, they cannot attract good talent; and two, if they somehow get it, they cannot handle it properly. Top pharma companies also invest substantially on the training of their people which increases their quality further.

Material Resources – Financial resources are on top. Developing materials, organizing events, investing in customer service, providing facilities, improving infrastructure, donating to hospitals, and spending to look good becomes a lot easier and quicker with ample money. The percentage of promotion budget may stay the same, but the real money multiplies when the revenues increase. Besides money, the other resources also add to quality of work. A nice office space for all staff, a decent lunch served during work, plenty of meeting spaces equipped with all necessary stuff like multimedia, smart screens, make work easier, have a pleasant effect on people, and improves performance.

Commitment to Job – I found quite early that people working in MNCs were more committed to their job. They took lot of stress and worked harder than others to keep and excel at their jobs. Local companies were smaller at that time, and they continuously lost their better people to MNCs. The tables have turned now. MNCs are less interesting now, much of their staff was relieved and the remaining ones are struggling to survive. They cannot leave because they are getting good benefits, and because they do not hope to get such deals in local pharma. Therefore, they are desperately trying to stick around, but it is just a matter of time. Top local players have developed the part which MNCs lost. That is why, their staff stays more committed to their jobs. They would even do fumigation at doctors clinics rather than leaving the job due to this reason. The analogy may be drawn with internation fast food chains. There are no janitors in McDonalds and KFC; the staff does the cleaning, taking orders, serving, and cleaning tables. No local restaurant has this arrangement.; they would have separate, full time sweeper for such jobs. The International food chain staff does it because they put higher value to their job.

Influence on Customers – Before the rise of local pharma, customers (doctors) preferred to relate to the MNCs because they had the money, reputation, and influence. They could get the foreign visas for conferences easily and had international networking to take care of their customers abroad. The products of MNCs were also good and no one could object to their prescriptions. Top local companies have all those features now, except influence. Presently, more customers, particularly, the elite ones, deal with the top companies only. It is partly due to status, and partly due to their financial muscle.

Networking – I can quote several astounding examples of networking, it works everywhere. The appeal and effectiveness of networking is universal. I would refrain to protect identities. In Pakistan, building networking is even more important because the system does not work without it. Large corporates influence policy making, circumvent regulations more easily, can get away with misdemeanors, and receive favors at all levels. The regulators who are supposed to implement policies and regulations also deal more softly with the big ones. In our country, where corruption has taken over the entire fabric of government and society, people with money can get things done more easily.

Marketing Strength – There is no doubt that the quality and quantity of marketing campaigns by top local pharma has become nothing less than excellent. Their top talent comes up with innovative, effective, and influencing ways of promoting their drugs, enticing customers, and beating competition. As I mentioned in the beginning, Pakistan market is very unevenly divided; the large companies are becoming larger and gobbling up even more market share, while smaller players are struggling in a smaller market pool. The analogy may be drawn with our society where rich are getting richer and poor are getting poorer; it is not so bad in Pharma but in some ways, it is.

Reach – Top local pharma has increased the number of their sales teams manifold, and they reach every corner of the country. It is not just about reaching there; the companies have stationed their salespeople in every small town. They have overtaken the whole space and have made it difficult for the smaller players to get business. Previously, larger companies focused on bigger cities and centers and left the smaller towns and centers to smaller companies so that they may scavenge business from there, but no more. The entire geography is now fully covered by top pharma companies.

New Product Launches

Another major difference is launching of new products. All generic companies who have grown big have launched new products by the dozen. During the last twelve months, more than 600 new generic products were launched by local pharma.

Launching a new product is now a complex process. The R&D is involved in developing formulation and packaging, the regulatory is involved to get it registered, supply chain is involved to arrange required materials, finance is involved to arrange funds for these activities, and marketing is involved to launch the product. The process is not just lengthy, it is costly also. While larger companies can do it more efficiently, smaller companies find it hard.

New product launches work differently for larger and smaller companies. Larger companies are holding a large pool of customers all over the country, so when their sales teams take the new products to them, these are accepted more easily, and business starts flowing more quickly. For smaller companies, every step is an effort, and many of them are holding a large inventory of non-performing products which are a big liability. 

Product registration sequence number crossed the barrier of 100,000 long time ago; more products are being added regularly. Do remember that these are all generic products, which means these are additional brands of the existing products. It is almost ironic that for certain products – chemical entities or molecules – we have more than a hundred generic products, which are supposed to be the same. This is where DRAP Policy Board has completely failed. There must be a maximum number of generic versions for any molecule/ product, and after that no further registration should be allowed. DRAP must realize that such large number of the same product will not offer the same efficacy and safety due to issues with material sources, equipment, expertise, and cost. It is time they think about it.

Sum Up

Pakistan Pharma Industry is a vibrant, thriving, competing, high energy, and high activity industry. Over time, it has become one of the major employers in the country. The policies surrounding pharma business at the federal level are deficient because the health ministers have been mostly non-technical, and the bureaucrats running the ministry are no better. No one is working to bring new ideas to promote, enrich, and regulate the pharma industry. 

On its own, the industry has done very well for itself. However, the same may not be said about the patients it serves and the people it employs.

To be Concluded……

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