Investment in Pharmaceuticals: Contract Manufacturing and Promising Raw Materials

Investment/
This was not the first time that Mr. Ahmed Al-Shahari, First Deputy President of the Yemeni Union of Pharmaceutical Manufacturers, addressed the topic—but this time, things are different. What were once only plans and directions have now become actionable steps being implemented on the ground.

Al-Shahari reiterated his position during a high-level meeting with senior officials from the Ministries of Health and Industry and the Yemeni Union of Pharmaceutical Manufacturers. The meeting was dedicated to setting a strategic policy aimed at localizing and producing 1,000 pharmaceutical products within five years. He affirmed the readiness of national pharmaceutical manufacturers to play a leading role in supplying high-quality medicines that meet international standards—at affordable prices that consider the economic realities of Yemeni citizens.

This effort aligns with the government’s broader strategy to support the national pharmaceutical industry and boost its production capacity, ultimately contributing to national drug security. In collaboration with the Ministries of Health and Industry, the Supreme Authority for Medicines has already implemented a number of measures to support domestic manufacturers and attract investment into this vital sector.

Essential Medicines List

Among the most notable of these measures are: the issuance of a long-term pharmaceutical policy, an updated list of essential medicines, and presidential directives to exempt pharmaceutical raw materials from taxes and duties—steps designed to help stimulate development within the industry both now and in the future.
Al-Shahari confirmed the Union’s readiness to adopt contract manufacturing as a strategy, highlighting that local pharmaceutical factories possess the infrastructure and capabilities to cover a larger share of the domestic market’s needs.
He noted that locally produced drugs are now capable of competing with European products due to several advantages: consistent efficacy and safety, no exposure to heat or humidity during transport, and lower costs resulting from the absence of intermediaries and distributors—all of which enhance the competitiveness of local medicines in terms of quality, safety, and price.

Phased Localization Strategy

As part of its push toward self-sufficiency, the Supreme Authority for Medicines has recently initiated the registration and regulation of pharmaceutical companies to ensure medicine availability and break market monopolies. Sixty-six products have been earmarked for exclusive local production, and a decision was issued to localize 1,000 pharmaceutical items over the next five years.
According to data from the Ministry of Health, the Authority has already received 20 applications to establish new pharmaceutical plants. Three factories are currently under construction, and an application has been submitted to build Yemen’s first medical supplies manufacturing facility.
The Authority also reports that 38 production lines became operational last year, with that number expected to reach 48 soon. Currently, 1,818 pharmaceutical products are being manufactured locally, and 15 new pharmaceutical laboratories are under development.

Medicinal Plants Guide

The pharmaceutical localization strategy will not be limited to contract manufacturing—especially in a country like Yemen, which enjoys immense climatic, agricultural, and geological diversity. This diversity can serve as a rich and promising source of raw materials for medicine production.
To capitalize on this potential, a comprehensive guide to medicinal plants has been prepared, identifying 15 specific plant species for cultivation and propagation. Additionally, 40 High-Performance Liquid Chromatography (HPLC) machines and other high-priority testing devices have been procured.
For the first time in Yemen, GC and GC-Mass spectrometry instruments have been installed at a cost of $814,000. Furthermore, the old laboratory has been renovated, and work has begun on a new pharmaceutical lab with a dedicated budget of 2.8 billion Yemeni rials.
In a related context, Al-Shahari remarked, “The Yemeni Union of Pharmaceutical Manufacturers has recently strengthened its collaboration with Yemeni universities, pharmacy colleges, and the Medicine and Investment Authorities. This is a highly significant step forward in the path toward localizing pharmaceutical manufacturing and achieving national drug security.”