While local pharmaceutical companies are striving to tap the US and European generics markets, they have shown little interest in the Gulf countries.
The reason -- while the market in Gulf countries is very small compared with the US generics market, top US and European giants have already established a strong presence there. It is thus easier for them to expand in the Gulf region than it is for Indian firms.
Local pharma company officials said that, while they have a presence in several countries in the Middle East, US and European markets are high on their priority list because these are among the biggest branded generics markets in the world.
The other overriding fact is the profitability of operating in the US and Europe, where margins are definitely higher than in the Gulf.
Several pharmaceutical companies are getting their manufacturing facilities certified by the US Food and Drug Administration or UK's Medicines and Healthcare Products Regulatory Agency. They are also setting up subsidiaries to tap those markets.
"The biggest issue is the market size. As compared to the US or Europe, the Middle East market is very small. Companies prefer to spend more money in areas where returns are likely to be higher. To top it all, major US and European companies have already gained a sizable share in the Middle East market," said Kamlesh Udani, executive director of Bharuch-based J B Chemicals and Pharmaceuticals Ltd.
Udani added that the Gulf Co-operation Council countries have also made USFDA, MHRA or European approval a requirement for entering their markets.
J B Chemicals has recently received approval of the MHRA for its facility at Panoli to manufacture tablet dosage forms for the UK market.
"The Middle East market is not as regulated as the ones in the US and Europe. While global pharma players have established themselves in the Middle East, Indian companies too have their distribution networks," said an official of Ahmedabad-based Cadila Pharmaceuticals.
He added that, like in other countries, product registrations have to be done in Middle East countries. This involves providing dossiers, getting approvals from the regulating authority and the like. Cadila has a presence in a few Middle East countries, the official said.
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