The pandemic and its ensuing challenges have transformed the global pharmaceutical industry, resulting in a highly volatile economic landscape.

Commenting on this in a recent LMDtv interview, the Group Managing Director of Sunshine Holdings Vish Govindasamy stated: “The pharmaceutical industry – more so than any other industry – has faced many challenges during the COVID-19 pandemic and post-COVID.”

He discussed how the industry has had to re-look at sourcing materials and production as the pre-pandemic ways of doing things – which included being dependent on materials coming from one destination – have not been effective in the post-pandemic world.

“Countries have also taken a very long and hard view on being dependent on imported pharmaceuticals coming into their countries,” Govindasamy added.

He explained that “as important as food security became [following the pandemic], healthcare and pharmaceutical product security have also become important to countries. So most nations have taken it upon themselves to ensure that basic drugs are produced in the local destination.”

Sri Lanka also began prioritising local manufacturing.

According to Govindasamy, only two or three percent of the country’s pharmaceuticals were produced locally pre-pandemic whereas between 25 and 30 percent are now manufactured in the island.

He noted: “Sri Lanka had a wake-up call with the economic issues that we faced; importation of medicine became a challenge so the government has taken initiatives to make sure that as many [medicines] as possible are produced locally.”

Globally, the pharmaceutical landscape has become very volatile for several reasons including increased consolidation in healthcare delivery and more pronounced regulatory requirements for new product development.

The Group Managing Director of Sunshine Holdings cited several challenges for Sri Lanka’s pharmaceutical industry – viz. the high cost of medicines, new and complex regulatory requirements, the need for research, environmental controls, sustainability issues and ESG requirements.

“All these put pressure and lead to higher prices. Costs will increase and generally be passed on to the ultimate consumer,” he explained.

The pandemic would have dampened the pharmaceutical industry but it resulted in local drug manufacturing. “The majority is purchased by the government because it’s no longer importing as much as it used to,” Govindasamy revealed.

“I believe that we should focus more on producing for ourselves before we produce for the region,” he emphasised, adding that this also posed several challenges.

He explained: “Ours is a very small population. Looking at our three neighbours who are very large pharmaceutical producers – namely India, Pakistan and Bangladesh – they have great scale and can produce on that scale.”

“Sri Lanka, with its population of 22 million, cannot produce on that scale; so we have to see what can be produced locally to make a difference and not be dependent on imports,” he added.

Govindasamy also highlighted the fact that “maybe there are things that are cheaper for us to import so those economies of scale need to be researched and decided on.”

He asserted: “Everybody feels that it’s the pharma industry that is costing the country money; but everyone needs to understand there’s a tremendous amount of waste because of our free healthcare system.”

Adding to this, he stated: “We need to re-look at the entire free healthcare [system], how it works and who the real beneficiary is. I’m all for free healthcare for people who can’t afford it but are we purchasing for everyone [including those] who can afford it?”

“We should all be worried about the quality of pharmaceuticals that come into this country and not the cost – because if you only worry about the cost, you won’t get quality,” he concluded.