The National Biotechnology Strategy represents a crucial step forward in our mission to improve the health and well-being of our citizens, while positioning our nation as the global leader in the biotechnology industry

H.E. Eng. Fahad Abdulrahman AlJalajel, Minister of Health

 

Continued Momentum of Vision 2030

In 2016 the Saudi government launched its Vision 2030 initiative aimed at reducing the Kingdom’s economic dependence on oil and building a strong economy. As a part of the Vision 2030 framework, a number of reforms have been introduced not only to restructure the Ministry of Health and streamline regulatory processes, but to foment the business environment and attract investment.

Several multinational pharmaceutical companies, including Novartis, Pfizer, Sanofi, Merck and GlaxoSmithKline have already created a presence in Saudi Arabia, either through direct investment, or partnerships with local players. The country’s increasingly attractive business landscape and its growing population in need of healthcare will continue to make it an attractive market -which is expected to reach a value of USD 15.1 billion by 2027 – for the global pharma industry in 2024 and beyond.

Moreover, because of Saudi Arabia’s strategic location, it remains an attractive regional hub from which companies can serve other markets in the Middle East and North Africa (MENA) region.

 

Boosting Local Production

The government’s push to support the local pharma industry and foment local production that began with a USD 3.4 billion investment plan in 2022 to strengthen pharmaceutical and health security and nurture local manufacturing potential will reach into the new year and thereafter.

The Local Content and Government Procurement Authority (LCGPA) has recently signed several deals for the localisation of industry and knowledge transfer. Among the agreements are a deal with Saudi-based Jamjoom Pharma and MSD for the production of type 2 diabetes therapy sitagliptin phosphate, as well as with the Saudi company Aja Pharma and the Saudi and Japanese-owned SAJA to produce the antiplatelet medication ticagrelor. According to the Saudi Press Agency the financial impact of these deals exceeds USD 67 million over 10 years for each of the agreements.

International pharma companies have also stepped up production in Saudi Arabia in recent years. Pfizer was the first multinational pharma company to be issued a “trading license” in 2016 with 100 percent foreign ownership of its legal entity in the country.  From its manufacturing base in King Abdullah Economic City, the big pharma supplies the Saudi market and claimed that in 2019 4.4 million Saudi patients benefitted from its therapies.

Under the cooperation agreement the Saudi Pharmaceutical Industries and Medical Appliances Corporation (SPIMACO) signed with AstraZeneca to provide services for local production, the company inaugurated a new factory spanning 2,800 square meters Qassim Region in 2022.

 

Big Plans for Biotech

The Kingdom is also looking to foment its biotech sector going forward and has announced a National Biotechnology Strategy, geared towards making the country a biotech leader in the MENA region by 2030 and a major international biotech hub by 2040.

“The National Biotechnology Strategy represents a crucial step forward in our mission to improve the health and well-being of our citizens, while positioning our nation as the global leader in the biotechnology industry,” the minister of health, H.E. Eng. Fahad Abdulrahman AlJalajel, commented. “The National Biotechnology Strategy outlines a comprehensive roadmap to address critical health challenges, accelerate medical advancements, and enhance patient care. With this strategy, we will leverage the power of genomics, precision medicine and advanced therapeutics to transform healthcare and improve the lives of people across the nation.”

The ambitious plan focuses on four strategic directions, many of which are centred on building Saudi self-sufficiency. In the area of vaccines, the roadmap sets out to develop vaccine manufacturing and enable exports across the region while encouraging local R&D to become a regional hub for late-stage development.

With respect to biomanufacturing, it aims to establish a local bio-manufacturing platform aimed at boosting self-sufficiency in biologics and biosimilars while enabling global export opportunities. The plan also looks to expand the national genomic database and analytics platform to enhance preventive healthcare and enhance the Kingdom’s food self-sufficiency and agricultural productivity.

The strategy aspires to contribute USD 34.6 billion to the country’s non-oil GDP by 2040 and create 11,000 job opportunities.

 

PPP Model to Prevail

Under Saudi Arabia’s Vision 2030 plan, the country has been activating the private sector’s participation in its healthcare transformation, advancing the public-private partnership (PPP) model to step up the rollout of new and more efficient healthcare infrastructures. This trend will persist in coming years.

“In the past, the government oversaw the building, operation, and maintenance of hospitals, but they have now realised that the private sector has an important role to play, providing upfront investment and delivering healthcare in return. The private sector is often more efficient and effective; that is how the country was able to deliver better services for the same or even less cost,” said Tarek El Rahbani, senior managing director, Growth Emerging Markets-South (Middle East & Africa) at Boston Scientific in a PharmaBoardroom interview.

Saudi Arabia has been laying the institutional and regulatory groundwork to encourage the participation of the private sector in its healthcare system for several years. In 2017, the government created the National Centre for Privatization & PPP (NCP) to manage its privatisation ambitions and introduced legislation to permit foreign ownership of the country’s healthcare infrastructures.

The next step came in 2021 with the Public Sector Participation Law, which established the regulatory framework around privatisation and PPPs. In 2023, the NCP issued a report that identified 59 initiatives to generate USD 42 billion in revenues via asset sales and PPPs by 2025 and in October, 2022, the Minister of Health, Fahad bin Abdulrahman Al-Jalajel, announced that Saudi Arabia would offer more than 100 healthcare projects over the next five years through PPPs.

The projects named included developing and operating two medical cities and setting up and running a 900-bed hospital to provide medical rehabilitation and long-term care services.