Pharmax shortens GCC pharmaceutical supply chain

New AED 125-million plant will have an annual production capacity of over 200 million tablet and capsule dosage forms to supply domestic and regional market.
Pharmax, Pharmaceutical, Supply Chain, Dubai

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Pharmax Pharmaceuticals (Pharmax) has opened the first pharmaceutical manufacturing plant in Dubai Science Park as it looks to shorten the supply chain for generic medications for chronic conditions in the Middle East.

The AED125-million plant will have an annual production capacity of over 200 million tablet and capsule dosage forms, Madhukar Tanna, chief executive officer of Pharmax, told Logistics Middle East.

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Pharmax opens AED125-million pharmaceutical plant in Dubai Science Park

“We are proud to be part of DSP’s vibrant business community, and are confident that now is the perfect time to launch Pharmax in the region,” he said. “Our company is fully aligned with the Dubai Industrial Strategy 2030 that, among other objectives, seeks to reduce the country’s reliance on imports of pharmaceutical products.”

“We are mainly targeting chronic medications, because that’s where the greatest demand is in this part of the world, and it’s where the domestic production was most lacking,” he added.

According to Tanna, demand for medications for chronic conditions has increased significantly in recent years, creating a shortfall in supply.

“With the introduction of mandatory health insurance in recent years, this has also driven up demand considerably so there’s a gap in the market that we’re looking to fill,” he said, adding that the domestic demand was one of three reasons the facility was being launched now.

“There are three main reasons we’ve decided to invest in our supply chain now,” he explained. “The first is the growth in demand for chronic medications, when you can produce high-quality generic drugs there’s no need for consumers to pay 50% to 100% more for brand names. The second reason is that the UAE Ministry of Health has been encouraging local production and they provide favourable terms like faster registration of products versus imported pharma goods.

“The third is that there is growing demand in the region as well, not just domestically. In Yemen, Saudi Arabia, Kuwait, Bahrain, there is a level of demand that exceeds current supply. From the UAE we’ll also be looking to export further afield to Central Asia and elsewhere,” said Tanna.

Marwan Abdulaziz Janahi, managing director of Dubai Science Park and chairing member of the Pharmaceuticals and Medical Equipment Taskforce of the Dubai Industrial Strategy 2030, said: “Our region currently imports more than 80 per cent of pharmaceuticals from abroad. At the same time, technological advancements, an increase in R&D capacities and talent availability, state-of-the-art infrastructure, proximity to emerging markets, and a favourable policy framework present us with a unique opportunity to enhance our domestic manufacturing capabilities.”

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The opening ceremony drew the participation of His Excellency Dr Amin Hussain Al Amiri, Assistant Undersecretary of Public Health Policy & Licensing at the Ministry of Health and Prevention, Dr Younis Kazim, CEO of Dubai Healthcare Corporation, Malek Al Malek, Group CEO of TECOM Group, Ahmad Tabari, chairman of the board of directors at Pharmax, Lamia Berrada, chairman of the managing board at Bottu Pharmaceuticals and Ayman Cheikh-Lahlou, CEO at Cooper Pharma.

Pharmax is a joint venture between the two companies, and will have an early mover advantage in Dubai Science Park, according to Tanna.

“There isn’t anything holding back local medicine production in the UAE, it’s more a case of a small but fast-growing market,” he said. “Within the next few years there will be a lot more pharma companies producing locally in the UAE. So opening this manufacturing facility now obviously gives us an early-mover advantage and we have extra land adjacent to the current facility onto which we can expand if need be.”

The phase 2 expansion, which is likely in 2020, will see the plant’s production capacity increased four-fold. “With the expansion of the facility in future we’ll add injectables, inhalers and any other products that we see demand for to our portfolio,” says Tanna. “We are ready to commence immediate production and will have our first sales within the next few weeks. As the UAE continues to promote innovation across verticals, Pharmax will work to enhance Dubai’s position as a pharma and pharmaceutical logistics hub. We have already been visited by the EU and expect EU certification for export to Europe within the next two months.”

For now, Pharmax will be producing drugs for cardiovascular disease, hypertension, peptic ulcer, diabetes, and medicines for the central nervous system for psychiatry and neurology. Tanna told Logistics Middle East, the first drug that they’ll start producing will be for the neurology market.

“The development of this facility is actually a backward integration for us because we already have a logistics arm that specialises in the distribution of pharmaceuticals to more than 2,000 retailers and 150 hospitals in the country,” he added. “So we won’t need to partner with a 3PL initially, but we will be looking to work with logistics companies for the export of drugs to other markets in the GCC and Middle East.”

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The factory is equipped with the latest European technology, meeting stringent global regulatory standards.

Established in 2016, the Dubai Industrial Strategy 2030 has identified the pharmaceuticals and medical equipment sector as one of six strategically important sectors for Dubai’s economy.

Positive forecasts predict that an increase in industrial capabilities will add AED160 billion (US$43.5 billion) to Dubai’s GDP, with the industrial sector growing by AED18 billion (US$4.9 billion).

Furthermore, the plan is expected to significantly enhance the UAE’s R&D capacities while adding 27,000 specialised jobs and AED15.8 billion (US$4.3 billion) to the country’s export sheet.

 “We are now able to locally produce medication for cardiovascular diseases, psychiatric and neurological disorders, gastroenterological diseases, metabolic disorders such as hyperlipidaemia and diabetes, central nervous system diseases, bacterial and viral infectious diseases, respiratory illnesses, asthma and allergies, bone and joint inflammation disorders, and urological diseases,” said Tanna. “This will significantly reduce the dependence on imports of related products from abroad.”

Construction of the facility began in September 2015 as a joint venture between Al Ittihad Drug Store, a distributor of medicines in the UAE, and two of the largest pharmaceutical manufacturing companies in Morocco - Cooper Pharma and Bottu Pharmaceuticals.

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