Pakistan Pharma Industry Opposes Changes to Drug Pricing Policy
The pharmaceutical sector warned that proposed revisions to the Drug Pricing Policy could disrupt supply, hurt margins and deter investment.
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Desk Analysis
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Sector Effect
Negative · Do not buy
Pharma sector faces policy uncertainty, leading to a negative outlook and a recommendation to avoid buying related stocks.
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Desk call: Do not buy · Negatively affected
- PharmaNegatively affected
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- INDU· Negatively affected · Do not buy
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Sectors: Pharma — Negative · Do not buy. PSX tickers: INDU. Pharma sector faces policy uncertainty, leading to a negative outlook and a recommendation to avoid buying related stocks.
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Open on ProPakistani## Industry Opposition to Pricing Revisions
The Pakistan Pharmaceutical Manufacturers Association (PPMA) has publicly opposed the federal government's plan to amend the Drug Pricing Policy 2018. The move follows a directive from Federal Minister for Economic Affairs Senator Ahad Cheema to the Health Ministry and the Drug Regulatory Authority of Pakistan (DRAP) to review the pricing framework, including the Hardship Policy and the DRAP Policy Board.
## Current Pricing Mechanism
Under the 2018 policy, the government regulates prices of essential and life‑saving medicines, which represent roughly 40 % of the market (about 500 molecules). Prices can be increased annually by up to 70 % of CPI inflation and are benchmarked against India, Bangladesh and Sri Lanka. In FY‑2026, essential‑medicine prices rose only 4.9 % versus 7 % CPI, keeping them below regional peers.
## Industry Concerns
Pharma officials argue that frequent policy changes create uncertainty, potentially affecting medicine availability, quality, investment and export capacity. They note that profit margins have improved from about 3 % two years ago to roughly 10 % after the 2024 deregulation of non‑essential medicines. The sector fears tighter margins could curb reinvestment in production, quality upgrades and export growth.
## Comparative Outlook
The association cited India’s pharmaceutical exports, nearing US$30 billion in 2026, as evidence that stable pricing and greater deregulation can fuel industry expansion. While deregulation of non‑essential drugs has intensified competition, the industry believes a consistent pricing regime benefits both patients and manufacturers.
## Call for Policy Continuity
The PPMA urges the government to retain the existing pricing and hardship mechanisms for a longer horizon, warning that repeated interventions could undermine the sector’s progress and the broader goal of affordable essential medicines.