Iran pharmaceutical industry overview

Posted on Posted in Business Guidelines

Industry overview

Pharmaceutical industry in Iran has passed different periods. The first one is the establishment period which was between the early of 1951 to 1978. Pharmaceutical industry was founded in the early of 1951 by building the first factory in Iran and gradually was developed until 1978. During this period foreign companies, in order to have better access to regional market and reducing production costs, established some new factories and produced medicine through mutual investment with Iranian parties. After Islamic revolution in Iran, by beginning the war and exit of foreign companies, pharmaceutical industry experienced a difficult period to meet the need of demanded medicine because of poor knowledge and lack of practical experience. throughout official negotiations and purchasing foreign parties ‘s shares, all of them became under the government ownership. The third development period includes the early of 1991 to 2001 and is known as the development period of pharmaceutical industries. Some new factories had been founded, some ownership changes had happened, 96 percent of medicine consumption in Iran and also 50 percent of materials have been produced domestically. At the end of third period, some positive events such as: producing cancer medicines, prefilled syringe for MS patients and entering biotech methods had happened. By strengthening sanctions, pharmaceutical industry has been dealing with different issues. But now with Rouhani’s government policies in health area and joint comprehensive plan of action, the industry condition has been improved.

Export & import statistics

According to Iran costume’s statistics, in 2015 Iran imported medicine from almost 60 countries, which amounts up to 1.4 billion Dollars and comparing to previous year, it has decreased in terms of value. Now approximately 46 percent of pharmaceutical`s import are the medicines which have similar domestic items in the country and therefore it seems that the policy of medicine`s import should be considered again in order to support domestic production and Iranian producers. On the other hand, exports to 30 countries are about 100 million Dollars. The main three countries in terms of export are Germany, Afghanistan and Syria. Also, Germany, Switzerland and United Arab Emirates are the three top countries in terms of import.

One of the main issues in pharmaceutical industry in Iran is the presence of black market. There is no exact estimation of black market value in Iran. These imports in addition to health dangers for consumers, is an obstacle for development of the market. Although the government has passed penalties for importing these medicines, it’s a threat for industry in Iran.

Ownership and management structure of Iran’s pharmaceutical companies

At the moment,3 holdings including social service investment company (SSIC), Barakat foundation and Melli Bank have 66 percent of medicine market in terms of ownership. For instance, Melli Bank via Shafa Darou Group has the control of some companies such as Osveh, kimiDarou and Jaber. Barakat foundation has the authority of companies like Alborz Darou, Sobhan Darou, Tolid Darou and etc.

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