Egyptian Pharmaceutical Sector Ready to Flourish
The Egyptian Minister of Higher Education and Scientific Education, Mr. Mufid Shihab, recently announced that the Egyptian government considers the local pharmaceuticals industry as one of the nation's strategic industries. The local industry currently produces EP 3 billion worth of pharmaceuticals per year - a significant amount, since the cost of importing the pharmaceuticals from outside Egypt would exceed EP 14 billion,
Al-Mustaqbal newspaper reported.
Official statistics peg the value of domestic pharmaceutical consumption in Egypt at EP 3.5 billion per year. While the national pharmaceuticals manufacturing companies meet up to 93% of this demand, the balance is satisfied through imports from abroad.
Total sales have been growing at 30 percent in the 1990s and have reached more than $1 billion in 1995, making Egypt the largest market in the Middle East, accounting for a share of about 18 percent of the regional total.
Total Egyptian pharmaceutical exports are estimated at EP 200 million, with the total pharmaceutical imports reaching an estimated EP 800 million. Egyptian pharmaceutical exporters traditionally target Eastern Europe and Russia, the EU (with an annual growth rate of 18 percent), Africa (12 percent growth rate) and the Middle East (9 percent growth of a market forecast at $5.6 billion in 1997 by UNIDO). Experts claim that Egypt should maintain and build on current exports of pharmaceuticals to a number of nations of which the foremost include: Saudi Arabia, Yemen, Kuwait, Iraq, the UAE, Nigeria, Sudan, Zambia, the Philippines, Korea, Sri Lanka and the EU.
The expanding Egyptian pharmaceutical sector currently consists of 50 firms and factories, including 7 manufacturing enterprises, 4 distribution companies and 34 private investment corporations. With 9 multinationals and 19 indigenous companies, Egypt is the leading producer and consumer of pharmaceuticals in the region. In addition, the nation boasts 70 scientific offices to distribute pharmaceuticals.
The pharmaceutical factories, which belong to the public sector, manufacture nearly 1,300 brands at an average price of EP per product. The joint enterprises, of which foreign partners hold up to 51% of the capital, produce 220 brands at an average price of EP 7-10. The private sector companies manufacture 700 brands at an average price of EP 15.
While per capita consumption of drugs is still low at approximately $12-$16 per annum, international comparisons would have to adjust for the significantly lower price ruling in Egypt. Per capita pharmaceuticals consumption hits $2,000 in the USA, $55 in the Gulf states and $24 in Lebanon, Syria and Jordan.
Low wages have been singled out by producers as one of the strengths of producing pharmaceuticals in Egypt. At less than 15 percent of production costs, wages are extremely competitive in what is essentially a labor and technology intensive industry. Another major asset to this industry is the large pool of highly skilled doctors, pharmacists, engineers and skilled technicians whose reputations have branded the nation a regional leader. (EP3.4=$1).
© 2000 Mena Report (www.menareport.com)