PAKISTANI DRUG EXPORTERS TO FAVOUR INDIAN RAW MATERIALS

Drug producers in Pakistan have urged India to relax "stringent" border rules. The calls, which come from a leading industry source, reportedly follow quality problems with imported production machinery and raw materials from China.

Pakistan's 316 drug manufacturers are jealously eyeing India's world-class generics export industry, as their domestic market continues to mature. A number of Indian firms have also entered Pakistan in the wake of the new patent law and tough price pressures at home — as have US multinationals, which are also expanding their local footprint.

The potential reorientation in Pakistan's international focus towards India is significant for the country's drug industry. A change of supply chains away from China suggests that Pakistani drugmakers are aware that competitive advantage will only be achieved through technical superiority in high-volume products — something that the rapidly-contracting Chinese industry is currently unable to provide. Meantime, Pakistan has now removed sales taxes on active ingredients, potentially boosting imports from India.

Meanwhile, in July, a delegation of Pakistani drug industry representatives visited the high-growth ex-Soviet Central Asian countries of Kazakhstan, Azerbaijan, Turkmenistan and Uzbekistan. If current industry strategy succeeds, Pakistan will hope to have established a viable, competitive generics industry in regions bordering the US$20bn Chinese market.