The Middle East and North Africa (MENA) region’s pharmaceutical market is projected to reach a value of around USD 60 billion by 2025 according to reporting from TradeArabia. The most impressive growth is coming from the UAE, but North African giants Egypt and Algeria are also significant contributors.
Factors accounting for this leap include sizeable population growth, increased life expectancy, greater prevalence of lifestyle-related diseases such as diabetes, and an greater prioritization of healthcare services among governments in the region.
The UAE: Aiming for ‘World Class’
Spearheading this growth is the UAE which, as part of its ‘Vision 2021’ plan, is aiming to provide “world class healthcare” in the Emirates by pushing for greater preventive measures to counter lifestyle-related diseases, implementing an accelerated drug registration system, and including health as a key sector within the country’s wider innovation strategy. Concretely, the UAE is funnelling over USD 1.2 billion into the healthcare system in its 2019 budget, which will be supported by substantial inputs from its USD 540 million innovation fund.
Capitalising on the country’s advantageous geostrategic positioning and, with the recent approval of the Dubai Silk Road Strategy and existing high-quality logistics infrastructure, the UAE is becoming a key source market; both manufacturing and exporting pharmaceuticals to high-demand markets such as Africa and Asia. 95 percent of global pharma companies already have a base in the UAE, giving them access to 43 countries worldwide.
Egypt: On the Up
Egypt, the region’s most populous nation, also boasts a pharma market on the up, growing at a compound annual growth rate (CAGR) of 17 percent between 2011 and 2017 to reach a total market valuation of EGP 50 billion (USD 2.9 billion) in 2017.
“[There are] 98 million Egyptians with demands that need to be supplied, with a big pool of labour and comparatively cheap manpower and workforce”
Despite a difficult economic and political situation between 2011 and 2014, stakeholders are once again recognising Egypt as a promising investment destination. As Hassan Behnam of the French Chamber of Commerce and Industry in Egypt notes, “There are many reasons why France considers Egypt as a strategic partner and why it is a good investment opportunity. First of all, its geographical location, with access to two seas; 18 airports; 65 seaports; proximity to the African market and easy access to the Gulf countries. Secondly, Egypt has many treaties with Arab countries, Latin America, Asia and especially Africa. The main one is COMESA, a treaty between Egypt and 19 East African countries that have 510 million inhabitants or potential consumers. Thirdly, its population: 98 million Egyptians with demands that need to be supplied, with a big pool of labour and comparatively cheap manpower and workforce.”
Egypt is also making moves towards implementing a universal healthcare system, is upgrading its regulatory apparatus by establishing a new ‘Egyptian Drug Authority’, and is welcoming in increasing numbers of medical tourists via its unique Hepatitis C ‘Tour n’ Cure’ scheme.
Stay tuned to PharmaBoardroom for our upcoming Egypt pharma report, due to be published later this Spring.
Algeria: Pressing Ahead
The healthcare sector in Algeria, Africa’s largest nation by landmass, has seen plenty of upheaval in recent years including the economic fallout from the global oil price slump of 2014 and the imposition of import restrictions on pharmaceuticals and medical devices.
Nevertheless, the USD 3.8 billion Algerian pharma market remains a high priority for MNCs investing in MENA, with many companies choosing to base regional functions out of the country. “Algeria stands out as the jewel in the crown so to speak, not only because it is one of the most manifestly stable countries in an increasingly volatile region, but also due to the favourable population dynamics, sheer market size and the underlying reality that consumer demand continues to blossom,” explains Essam Farouk, president of El Kendi.
Haissam Chraiteh, Sanofi’s country chair for Algeria, adds, “From a business point of view, Algeria has a great deal to offer. Not only is this the second largest market on the African continent, but it is also a heavyweight when compared to other Middle Eastern markets. One of the characteristics that immediately stands out in Algeria is the sheer importance that the authorities place on securing access to healthcare for patients.”