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French Version

Pharmaceuticals growth

Jordan’s pharmaceuticals industry continues to be one of the success stories of the country’s recent economic boom, posting sizable growth over the past few years and bolstered in large part by a rigorous intellectual property framework.

According to figures released earlier this year by the Jordanian Association of Manufacturers of Pharmaceuticals and Medical Appliances (JAPM), the country’s pharmaceuticals sector now accounts for a growing chunk of the country’s exports. In 2006, pharmaceutical products comprised approximately 11 percent, or $500 million, of the Kingdom’s exports, a nearly 20 percent increase over 2005. This is expected to double to $1 billion by 2010.

The industry now sends products to around 60 countries throughout the Middle East and North Africa region, Eastern Europe and Asia, and boasts a production capacity of over $1.4 billion.

The numbers are encouraging for what has become a thriving industry in Jordan. Although the domestic pharmaceuticals industry is only about 40 years old, it has carved out a strong niche for itself in the regional market, with 18 registered companies pumping out a variety of medical products.

The impressive growth over recent years can be attributed in large part to the adoption of rigorous intellectual property rights frameworks. Reforms have been implemented in accordance with the Kingdom’s 2001 free trade agreement (FTA) with the US and, following its accession to the World Trade Organization (WTO) in 2000, through the adoption of new regulations consistent WTO’s Trade Related Aspects of Intellectual Property Rights (TRIPS) agreement. The changes have had a dramatic impact on the visibility of the Jordanian pharmaceuticals industry.

Speaking with OBG, Samir Mansour, regional representative for the Middle East and North Africa Pharmaceutical and Research Manufacturers of America, said, “Jordan’s international commitments, through the WTO and the FTAs, provide an appropriate framework for an appealing investment climate in the pharmaceuticals sector.”

Prior to its adoption of the intellectual property rights (IPR) regulations, Jordan frequently came under fire from multinational companies over its lax IPR oversight but following the WTO and FTA reforms, Jordan has expanded its data exclusivity laws, allowed for patents on pharmaceutical products and placed stringent restrictions on compulsory licensing requirements. As a result, there has been a noticeable increase in pharmaceuticals research and development investment.

Private funding for Jordan’s clinical research sub-sector has been growing steadily. In the years following the IPR reforms, two new clinical research organizations (CROs) came online, joining three research and development centers already in existence. A number of multinational firms, including Merck Sharpe and Dohme, Aventis, Novartis and Pfizer, have begun to conduct clinical trials in conjunction with local CROs, such as the King Hussein Medical Center. Over 17 clinical trials have been carried out in Jordan in recent years, ranging from a three-year trial evaluating cardiovascular risk factors to experimental therapies for cancer patients.

The clinical trials are also expected to boost Jordan’s medical tourism sector, which has grown significantly in past years. According to a 2004 report by the US-based International Intellectual Property Institute, medical tourism composes an estimated two-thirds of tourism revenues in the Kingdom, with patients drawn to the high quality and relatively low cost of the primary and secondary health care systems.

Although the country’s pharmaceutical companies have eked out a strong position in the regional drugs market, the industry still relies heavily on export growth. With the re-emergence of Iraq as an export destination and the easing of trade restrictions with other neighboring countries, Jordan’s pharmaceutical manufacturers are banking on further growth in the coming years.

However, while the industry is the third-largest exporter in the country, the local market is still supplied in large part by imports from overseas, with only 30 percent of domestic demand covered by local—and largely generic—products. This is significantly higher than some of Jordan’s neighboring countries, like Saudi Arabia, which lacks a developed pharmaceutical industry, but remains lower than countries such as Egypt, where local manufacturers supply over 80 percent of the market.

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