The surveyees have spoken:
I will be covering the pharmaceutical industry in Jordan, a sector I have no clue about. If you ask me what is the difference between this or that medicine, I will tell you that I do not care and to just inject me with it.
So without further ado, here is your financial dose on drug making in Jordan.
Sector at a glance
The pharmaceutical sector is one of the largest industrial sector in the country, employing over 25,000 people with 40% being female.
Local production is estimated at $1 billion with 60% going towards exports.
In 2021, pharmaceutical products accounted for the 5th largest national export reaching 420 million JODs. Saudi Arabia was the largest market at 22%.
Most of the local production focuses on generic drugs which make up most of local consumption and export. We, in Jordan, import originator drugs as it is the doctor’s favourite prescription.
(Side note: a pharmaceutical company invests in R&D and “creates” a new originator drug and gets a patent that lasts 20 years. This patent allows them to recoup their investment and make some profits. After the patent expires, any company can create that drug. For e.g. Pfizer and their patent for Viagra. Now anyone can create a generic form of that blue pill1)
For an in-depth SWOT analysis of the sector and challenges facing the export market, I recommend reading the recent report done by GIZ, it also includes an overview of the privately owned companies: VALUE CHAIN ANALYSIS FOR THE PHARMACEUTICAL SECTOR IN JORDAN
Listed companies
One of the largest companies in this sector is Hikma. It is a beast on its own and it is listed in the London Stock Exchange, not in Amman. In 2021, it generated over 2.5 billion in revenue. It has its own venture arm to seek out new companies doing research in new molecules: Hikma Ventures.
Let’s focus on the 5 Jordanian pharmaceutical companies listed locally (I won’t cover NutriDar which makes baby formula):
JPHM seems to be making a come back, possible getting out of the OTC market soon.
Market Share distribution:
Financially speaking, most companies seem to have robust balance sheets and steady sales. They might need to focus on increasing exports (mainly GCC and new areas such as East Africa where demand is rising). They could also keep developing generics that focus on prevalent diseases in the region: - obesity2 - smoking related illnesses3.
Before investing, maybe try do more in-depth research on the different products being developed and if any have an edge over others (locally and internationally). Maybe some companies have new drugs in the pipeline.
In the meantime, the only financial recommendation I could give is to get health insurance and stay healthy (exercise & diet, body & mind, staying off social media).
We are already blessed to have some of the lowest cancer rates in the world:
Future outlook
According the Minsitry of Higher education, Jordan saw 57,888 students graduate with a bachelor degree from public and private universities in 2016 (MoHE haven’t updated the data since).
Of those, 15.8% graduated with a degree in engineering, and 11% in education.
1,975 students graduated with a degree in pharmacy (3.4% of total).
Is the market saturated with no capacity to absorb these new graduates?
What hopes do they have in this field?
Will the sector, with the assistance of the government, invest heavily on research to develop new drugs to compete in the market and cure prevalent diseases?
Others could be lucky enough to get some cash from their family & friends and open their own small pharmacy store then to cash in big and sell it to the next new large pharmaceutical franchise called PharmaThree.
If you know of any new ground breaking drug being developed in Jordan, please share it in the comments!
https://qz.com/1149322/pfizer-is-releasing-a-generic-viagra-as-its-patent-expires/
https://pubmed.ncbi.nlm.nih.gov/32512659/
https://thearabweekly.com/jordan-fears-double-pandemic-smoking-rates-hit-all-time-high
Interesting article. I like these deep dives.
Btw cancer rate distribution by country is driven to large extent by skin cancer rates which differs a lot between countries. This is what makes Australia number 1 and the middle east cancer rate low (people cover up). Dr Berg is a quack, don’t take him seriously (he’s also not a doctor).
"new ground breaking drug" is not about the minds nor the equipment, it's about the enormous cost. One of companies mentioned in the article invented a new drug but could not support the cost of its development.