At last month’s CPHI Milan – the world’s largest pharma event with 60,000 attendees – one of the key growth markets for the next decade was explored in depth. With the inaugural CPHI Middle East set to launch in Riyadh from December 10th-12th, we spoke with Pushpa Vijayaraghavan, Healthcare Practice Lead for Sathguru Management Consultants. Pushpa, who spoke on a panel at CPHI Milan, will also be present at next month’s CPHI Middle East panel on Evolving continental and regional opportunities in Africa. We discussed opportunities in Saudi Arabia to help the government meet its ambitious goals of building an advanced manufacturing and biomanufacturing hub in the region, how global innovators and generic majors can contribute to the region, and how the region can serve as a gateway platform for delivering vital medicines across Africa.
CPHI Middle East 2024 will welcome over 30,000 visitors and 400 exhibitors, making it the region’s largest pharma event. As Saudi Arabia’s $12.1 billion pharma market undergoes rapid transformation under Vision 2030, the event will bring new opportunities for private investment and partnerships. With over 81% of generic drugs and 94% of medical devices currently imported, Saudi Arabia offers significant potential for companies to localize production and support its expanding healthcare sector.
The region is expected to be one of the fastest-growing markets in the CPHI global portfolio and is anticipated to become a hub for implementing next-generation manufacturing technologies across the Middle East. Additionally, it is poised to serve as a burgeoning center for collaborations, supporting both local manufacturing and the launch of finished drugs across Africa.
Q: What developments do you foresee in the Middle East over the next five years? And what strategic objectives are these countries prioritizing to achieve this?
A: “Over the next five years, we expect to see the Middle East, particularly Saudi Arabia, and regions in Africa establish advanced manufacturing hubs focused on pharmaceuticals and biomanufacturing. Saudi Arabia is aligning its domestic pharmaceutical production goals with its Vision 2030, aiming to increase local production from the current 20% to 40% by 2030. Initiatives like the National Biotech Strategy are central to positioning Saudi Arabia as a global biotech leader, fostering resilient national value chain across product categories such as small molecules, bio-therapeutics and vaccines. There is a also significant focus on services and upstream research, especially in areas such as genomics development. The sector growth hence primarily reflects the Government’s 2030 vision and prioritization of biotech and pharma as key sectors for localization and value chain development.”
Q: Why should companies looking for partners consider the Middle East, and what specific opportunities are there for Global companies?
A: “Saudi Arabia’s growing ecosystem creates opportunity for global companies to both serve the local market and to leverage Saudi Arabia as a base for acceleration and global growth. This is true across both, innovation led pharma companies and for generics. In the case of generics, there opportunity for partnerships and market access is more rife in complex products such as injectables, inhalation, peptides and biologicals etc. Across these, there is significant opportunity for FDI and companies to directly setup presence in Saudi Arabia as a hub for the MENA market. With the base of local pharma companies rapidly expanding, there is also significant opportunity for tech transfer partnerships in the case of complex generics. Even in API, tech transfers and joint ventures are worth exploring.
In the case of innovative ventures, Saudi Arabia is nurturing the ecosystem for innovation advancement while enabling access to capital as well. Thus, there is also significant opportunity for global innovation led ventures to accelerate with Saudi Arabia as a base for translational advancement to global markets. Across both these categories the Saudi FDA achieving Maturity Level 4 (ML4) on the WHO Global Benchmarking Tool (GBT) provides confidence to global companies that a robust regulatory ecosystem serves as an anchor for industry efforts.
The investment momentum so far reflects this potential. Leading Indian generic companies such as Aurobindo Pharma and Hetero have setup their own manufacturing presence in Saudi Arabia. A global innovator such as Eli Lilly has not only forged a tech transfer partnership for insulin manufacturing but has also announced a collaboration with the King Faisal Hospital for Alzheimer care.”
Q: Could you provide insight into the Middle East’s pharmaceutical landscape? How does it complement the growth in Africa?
A: “Africa’s $20Billion pharma market has until now not been a significant commercial focus for most companies. Part of the market that operates through global pooled procurement has been served by high quality drugs that are USFDA approved or WHO prequalified. This market segment is currently served by large generic companies such as Viatris and Aurobindo with manufacturing base in India. Rest of the market includes public procurement by national governments as well as private markets.
Historically, targeting commercial opportunities in the region has been challenging due to the lack of aggregation, making it difficult for companies to operate effectively. Additionally, limited regulatory maturity and a weaker focus on local procurement further hindered market development.
However, significant progress has been made in recent years. Pre-COVID structural initiatives and extensive cross-stakeholder engagement post-COVID have established foundational enablers, making the region more attractive for both market – accessing as a market and for investment in the region. There are several stakeholders (national, continental and from global health) now engaged in the collective effort of nurturing the overall ecosystem for pharma, including regulatory capacity, human resources, infrastructure, technical services etc. There are also foundational initiatives around market aggregation – most notable being the African Medicines Agency serving as a continental regulator and the African Continental Free Trade Agreement (AfCFTA) that can enable duty free trade across the continent in the future. These efforts are creating an environment that supports and facilitates more attractive business environment for pharma and opportunity for local manufacturing, paving the way for a more sustainable and robust pharmaceutical ecosystem in the future.”
Q: How do you see Sub-Saharan Africa evolving over the next few years?
A: “So, the Sub-Saharan Africa (SSA), at the other end, is a region where market aggregation has been true only in the case of established infectious disease products paid for by global pooled procurement (HIV, malaria, TB etc). Regulatory capacity development is now in focus and continental stakeholders such as Africa CDC are now exploring the possibility of pooled procurement in other indications. There is now high political will across several countries to steer change and foster a conducive ecosystem for pharma and biotech. Rwanda is a notable example. The country now hosts the first mRNA commercial vaccine manufacturing in Africa with BioNTech choosing to invest in Rwanda. We are advising the Government and IFC on the development of a proposed life sciences park that will converge key ecosystem building blocks. There is also thrust on regulatory capacity development and human resourcescapacity development with the fairly young Rwanda FDA now being close to ML3 certification and collaborative effort with support from GIZ and the EU delegation on creation of new courses and expanded cohort of skilled human resources to support industry investments. Several other countries are also actively focused on ecosystem development and regional value chain with Nigeria and Ghana in West Africa, Kenya in East Africa and South Africa being notable examples.”
Q: How are companies working with governments to establish a manufacturing ecosystem in Africa? Are there any public-private partnerships happening?
A: “Africa presents significant opportunities across both public and private healthcare. Non-communicable diseases, though historically underprioritized, represent a chance to bridge quality gaps and address unmet needs. Governments are strengthening regulatory ecosystems and establishing life sciences parks, enabling companies to operate independently or through partnerships. There’s a significant need and opportunity to bridge what is today a fairly wide quality gap because it’s not been a highly prioritized market. So, across both public and private health, there’s an opportunity and potentially a pathway to partnerships.
As price erosion intensifies in traditional export market of United States the markets in Africa get more attractive with the current focus on ecosystem development and market aggregation. Over the last few years, companies have looked toAfrica to diversify their business and mitigate risks. With its status as an underserved market, early movers stand to gain a competitive edge as the market matures over the next decade. There is opportunity for industry to work with Governments on collaboratively expanding the opportunity and maturing the ecosystem. This includes collaboration with regulators on capacity development, with public initiatives around human resource development etc.”
Q: Reflecting on your experience at CPHI Milan, what makes CPHI Middle East a unique and beneficial event for attendees, especially considering the opportunities in the Middle Eastern?
A: “While CPHI Milan provides a global platform for pharma insights, CPHI Middle East brings a distinct, region-focused approach that highlights the Middle East’s growing role in biopharmaceutical manufacturing and partnerships for the first time. This event in Riyadh will give local companies an unprecedented chance to showcase their capabilities to an international audience, facilitating connections not only with nearby markets but also with potential partners from around the world. With the opportunity to connect with a wide range of both global and local companies bringing their individual unique expertise, CPHI Middle East allows both local and international companies to explore collaborations and better understand the regulatory landscape in a market set to play a key role in meeting pharmaceutical demands across the Middle East and Africa.”
Q: Looking ahead, how do you anticipate the contract services market in Africa and Middle East will grow, and what might this mean for companies in the coming years?
A: “This evolving regulatory and trade landscape is spurring the development of life sciences parks and drawing interest from CDMOs. While the region remains largely untapped, CDMOs have a significant opportunity to partner locally, bolster Middle East manufacturing, and support global innovators in tailoring solutions for the continent. These changes are expected to drive localized production and foster industry growth, propelled by market unification and regulatory clarity. Partnerships and services ecosystem are likely to accelerate realization of this opportunity. Technology transfer and joint venture partnerships are being pursued across both the MENA and Sub-Saharan Africa markets. Some of the Saudi pharma companies are also considering partnerships in Africa to expand market reach.
Additionally, CRO and CDMO services are also attractive in both MENA and Sub-Saharan Africa at this point. This includesopportunity for fill-finish for injectable and biological drugs, oral solid contract manufacturing for innovators keen to enable access but preferring to engage with CDMOs and contract research services across pre-clinical, clinical and analytical services. The segment is currently under development and there is significant headroom for market creation and growth.”
