The Indian government is studying plans to ease the entry of drug companies, including Dr. Reddy's and Hetero, into the Tunisian market, partly as a means to increase access to the European Union (EU). Favourable trade terms with the EU and local market value of some US$400mn have underlined Tunisia's growing appeal for Indian drugmakers.
Tunisian government sources note that the country liberalised the distribution of registered drug products at the start of 2005, in line with WTO obligations. Recent market expansion has benefited the domestic manufacturing industry, which comprises roughly 25 firms, and many of the main multinationals are already present, while the influence of French companies is especially strong in Tunisia.
Further, beyond the possibility of EU access, solid economic performance in recent years may have made Tunisia an attractive option in itself. Growth in Tunisia's export-driven economy reached 6.5% in 2004, with drug market expansion estimated at 6% in the year. The country is also widely perceived to be more economically stable than most of its regional peers.
Tunisia's domestic manufacturing industry only meets 40% of demand, and there are clear opportunities for Indian companies in traditionally strong areas such as generics. The sector currently accounts for approximately 12% of the market in value terms, and with only about 800 patented or generic pharmaceutical products on the market, key segments are likely to remain underdeveloped at present.
With the recent launch of a new national healthcare plan, which is set to reform public sector health procurement and streamline regulation, Tunisian authorities are currently seeking greater co-operation with drug producers, especially with HIV/AIDS and mass vaccination programmes. Given their strength in these areas, and increasing price pressures at home, Indian firms are increasingly likely to follow other leading producers of inexpensive drugs in stepping up activities in Tunisia.