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Ninety-eight percent of the domestic demand for pharmaceuticals are met locally, though foreign niche products account for over 30% of the domestic market value.
Ninety-eight percent of the domestic demand for pharmaceuticals are met locally, though foreign niche products account for over 30% of the domestic market value.

Global Pharmaceutical Giants Eye Iranian Market

Iran’s pharmaceutical exports were at their peak with $200 million to 17 countries in the fiscal year to March 2015, while imports stood at over $1 billion
Danish drugmaker Novo Nodrisk is investing €70 million in an insulin production factory in Iran

Global Pharmaceutical Giants Eye Iranian Market

The Second International Exhibition on Pharmaceuticals and Related Industries (Iran-Pharma 2016), which opened on Wednesday in Tehran, was attended by high-ranking officials and over 400 industry players from more than 40 countries.
Close to 100 prominent companies from Italy, Germany, France, Denmark, Italy, England, Switzerland, Belgium, Japan, South Korea, China, Argentina, Spain, India and the Czech Republic came together in the first post-JCPOA major pharmaceutical exhibition in Iran.
There was a certain air of professionalism at the expo, as it was attended only by pharmaceutical producers and players, but no importers, exporters or middlemen were present.
According to Abbas Kebriaeizadeh, the head of the Syndicate of Iranian Pharmaceutical Industries, invitations were sent only to “companies that had involvement in Iran’s pharmaceutical industry and are able to help the sector move forward, both in terms of [providing them with] production technology and also helping with exports”.
The attending companies included well-known international names such as Merck, Bosch, AWH, Azupharma, Dr. Muller, Harro Hofliher and M+W from Germany, Comas, Easypharma, Ronchi and Pharma Quality Group from Italy, Boccard and Kalix from France, Pharma Packaging Systems and MRC Systems from England, Argenol Laboratories and Telstar from Spain, Sejung from South Korea and Aseptic from Belgium.
“Iran’s pharmaceutical industry has the capability to go beyond its borders and dominate the lucrative 400-million-strong regional market,” said Rasoul Dinarvand, the head of Food and Drug Administration of Iran.
The official noted that the buzzing expo and the foreign companies’ enthusiasm to enter the country and set up shop is a testament to this potential.
“Our population and the country’s pharmaceutical demand, as sizable as it is, is still limited. Our number one priority must be in using our technological advantage in the region to embark on exports,” he said.
He added that Iran’s pharmaceutical exports were at their peak with $200 million to 17 countries in the fiscal year to March 2015, while imports stood at over $1 billion.
According to Dinarvand, 98% of the domestic demand for pharmaceuticals are met locally.
Nonetheless, foreign niche products account for over 30% of the domestic market value. The industry imports more than half of its raw materials for chemical drugs and is self-reliant in biopharmaceutical raw materials.
Based on the goals set in the next five-year economic development plan (2016-21), the pharmaceutical industry must garner at least 75% of the domestic market.
The development plans are laws drafted by the government and ratified by the parliament every five years since 1991. The primary aim of the plans is to pave the way for the realization of the economic development targets enshrined in the 20-year Vision Plan (2005-25).

  Promises, Risks
Danish drugmaker Novo Nodrisk, the world’s top insulin supplier, was one of the more notable attendees at the expo. The company’s booth was actually positioned in an area at the heart of the expo and away from the international pavilion, highlighting Novo Nordisk’s special status for the Syndicate of Iranian Pharmaceutical Industries, the organizer of the event.
The pharmaceutical giant is well known in Iran, as it maintained a staff of around 130 in the country through the sanctions era ever since 2005 and now plans to more than double that, adding 160 additional workforce, following a decision in late 2015 to invest €70 million in an insulin production factory in Iran.
“The construction of the insulin plant is the single biggest investment in Iran since the Islamic Revolution and the company’s biggest involvement in the country to date,” said Farhad Raoufi, Novo Nordisk’s Public Affairs Production Manager.
“We have had a long involvement in Iran and now that we are back, we see that a lot of improvement is done,” noted Mikkel Severin Larsen, the company’s project director LAP. He emphasized that Iran’s medical infrastructure for diabetes diagnosis has improved through the years and now there is a better and more thorough understanding of the country’s diabetic population.
“This indicates that the market is expanding and Novo Nordisk is ready to provide patients with high quality treatment,” Larsen added.
The Danish industry player said his company is ready to transfer production technology and knowhow to Iran by training Iranian industry specialists.
“The plant we are constructing will be solely hiring Iranians alongside maybe a handful of foreign experts,” he said, adding that the factory’s production technology, product quality and manufacturing equipment will be the same as the company’s main plant in Denmark.
“We plan to outperform all other companies in the sector in terms of efficiency and product quality. That requires having skilled people on board in the long run. Hence, recruiting talented workforce and training them are key to success,” said Larsen.
The company official added there are a lot of eyes on Iran and a potential competition has ensued between foreign companies to enter the country’s insulin market. Yet, Novo Nordisk is currently the only producer of the diabetic drug in Iran.
According to Larsen, the €70 million insulin production plant is expected to become operational by 2020 and the company is currently in the process of designing the factory, determining its required production machinery, IT solutions and output capacity.
The lifting of international sanctions imposed on Iran over its nuclear energy program considerably eased the process of entering and operating in the Iranian market and was the primary incentive for the comeback of foreign companies. But not all is well, as most of the US embargos on Iran are still in place, pertaining to financial transactions and software licensing limitations.
“We could not use many IT solutions and Microsoft software in Iran due to licensing issues during the sanctions period. And the problem still persists,” said Raoufi, hoping that the ongoing government negotiations with world powers can ease the situation in future.
Bosch Packaging Technology Ltd. was another European company making a comeback to Iran in the post-sanctions era, but unlike Novo Nordisk, the German company is taking smaller steps.
According to Mazen Homssi-Touban, the executive general manager of the company’s packaging technology division, Bosch specializes in undertaking pharmaceutical industry turnkey projects for the production of products such as tablets, capsules and vials.
“We are happy to come back to Iran to our old friends, as most of Iran’s pharmaceutical industry is equipped by Bosch,” he added.
The company’s agenda, according to Homssi-Touban, is refurbishing and upgrading the machinery already installed by Bosch in Iran, and gradually increasing their capacity and production quality.
“Your pharmaceutical industry needs small modifications for now and that can be done with high speed and efficiency,” he added.
The German industrialist noted that Bosch plans to work minimally and in small quantities for the time.
“The second step is that we hope the sanctions are fully removed in future and people start ordering the more expensive and complicated machinery,” he said.

 

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