Pharma companies petition for additional medicine price hike after fuel price increase

Cairo – July 30, 2024: Egyptians might need to brace for another medicine price hike as local pharmaceutical companies recently petitioned the Egyptian Drug Authority for an additional 1 percent increase in prices, following a recent 25 percent hike earlier this month.

Pharmaceutical companies continue to grapple with rising transportation costs, prompted by the recent increase in fuel prices, the Egyptian pound's depreciation against the US dollar and the impact on trade by the Houthi attacks in the Red Sea.

The sector has been forced to shift transportation from sea freight to air freight due to disruptions in the Red Sea, which have doubled transportation expenses, explained Head of the Pharmaceuticals Division at the Federation of Chambers of Commerce Egypt, Ali Ouf.

Speaking to Hapi Journal, Ouf explained that, despite these challenges, domestic pharmaceutical production continues to meet 92 percent of local market demand, with exports amounting to 25 percent of total production, valued at approximately $1 billion.

Pharmaceutical sales in Egypt surged by 5 percent in the first half of 2024, reaching LE 90 billion compared to the same period last year. However, unit sales experienced a 7 percent decline, reflecting the economic pressures affecting consumer purchasing power.

Egypt’s total pharmaceutical sales are projected to reach LE 200 billion by the end of 2024, according to Ouf, buoyed by the recent price hikes which are expected to stabilize pharmaceutical companies' profits in the near term.

In terms of medical supplies exports, Mohamed Ismail Abdo, head of the Medical Supplies Division at the Cairo Chamber of Commerce, shared yesterday that Egypt’s exports rose by 15 percent last year to hit $320 million.

Abdo also outlined plans to raise annual exports of medical supplies to $1 billion, depending upon enhanced export support and support for participation in international exhibitions.

The medical supplies sector in Egypt recorded significant growth between 2004 and 2012, explained Abdo, boosted by the country’s industrial modernization program and support for around 80 percent of participation costs in exhibitions across the world.

Egypt is reportedly looking to launch an ambitious regional center to meet local and future needs for pharmaceutical raw materials, according to sources in the know speaking to Al Mal on Tuesday.