Arab Health Exhibition has become the gateway for pharmaceutical manufacturers all over the world to showcase their products and technology to the customers of the Gulf, Sub Saharan Africa and South Eastern Europe. Allied to this, the healthcare segments also tag on to the pharmaceutical fraternity in exhibiting their products.
The event, year after year, sees a quantum leap in the area of exhibition and number of participants. Though real-time business, may not be of significance, the exhibition has become configuration of contacts, which are matured into eventual business.
Pharma companies from Germany, France, and China occupy the largest portion of the exhibition, clearly indicating the business volume these countries generate. Chinese exhibits are more of Health Care nature and less into formulation in comparison.
Opportunities in pharma sector
As explained earlier, the western influence on the Gulf community adversely impacted Indian opportunity. The knowledge limitation among them always led to believe that what India can provide is only loyal labour / workforce. In the past 25 years, hardly any presence of Indian pharmaceutical manufacturer is noticeable in the Gulf. Even if present, they are large pharma companies with a limited product profile. Ranbaxy, Cadila, Cipla, Himalaya are amongst them. They have not been very aggressive and merely catering to Indian population by distributing their products mostly through local networks. Of late, things seem to be changing for the better. The people in Gulf were also used to this limited number of large companies and did not look for new horizons beyond.
A few years ago under such scenario, the "Indian Pharma Alliance"(IPA) in UAE consisting of pharmacists of UAE and other Gulf countries, took the initiative to showcase Indian pharma products by conducting seminars, press release and through T.V. publicities offering them to provide quality pharmaceutical products at cheaper costs.
Most of the larger units in India like Ranbaxy, Cadilla, Cipla, etc were already compliant in view of their foray into markets of the west. But, such opportunity was not forthcoming for smaller units.
The opportunity in Gulf in general and UAE in particular becomes realistic destination as they can cater to the locals who expect western standards of drug formulation at a cheaper price and also the Indian expatriates who know these medicines, while they were in India. Further, the attachment to Indian company / product is also an influencing factor.
Instead of looking at expatriate Indians alone as a source of market, why not look at positioning each company's product in the shelf along with the products from the west, highlighting the cost advantage of Indian products. The manufacturers from the West, have exploited the Gulf / UAE market far too long in the name of quality processes and products. When we match it with similar production facility obviously all products also become qualitative. All we need to do is to create perceived value of this comfort by effectively making appropriate publicity through ethical means or by effective advertisement campaigns, in case we propose to market all branded formulations under OTC category.
The Industry Association in India, Ministry of Chemicals & Fertilizers, The Ministry of External Affairs and the Drug Control Authorities should proactively join hands and promote the drug industry highlighting the drug manufacturing standards.
The 9 / 11 episode, has also influenced them to look at alternate destinations to do business. Having understood that India as a favoured destination, the authorities in Gulf/UAE are infavour of importing pharmaceutical products provided units in India are able to offer quality medicines manufactured in facilities conforming to western standards.
It is essential that manufacturers from India should inspire themselves to upgrading their facilities to global standards in order to export their products to GCC/UAE and also to sub Saharan African countries, where pricing is a sensitive issue.
There is good distribution network and one can choose the right partner. It is also possible to establish own marketing and distribution network. In that case, it would be more appropriate for 2 / 3 companies to come together to set up common distribution facilities so as to share the costs and also to optimize the resources.
The Gulf Cooperation Council has centralized the entire process in Riyadh, Saudi Arabia. The papers can be submitted through any of the member countries including UAE. Depending on the target market, the choice of the country can be decided wherein UAE offers a comfortable platform for doing business. But, of late, other GCC countries also are providing incentives to establish business in their territories.
It might cost between $5000 and $7500 per product for brand approval, site visit, and product approval besides other incidentals such as travel, stay, etc. The market size is big enough to recover the cost through strategic positioning of the product in the market over a reasonable period of time.
In case our manufacturers are prepared for this outlay, they can be assured of a captive market in the Gulf, UAE and sub Saharan Africa for branded as well as generic formulations.
(The author is head - Finance & Corporate Affairs,Apex laboratories limited, Chennai.)