PHARMACEUTICAL

INDUSTRY

INTRODUCTION
Turkeys pharmaceutical production makes it
16th among the world's 35 leading
pharmaceutical producing countries.
Turkey has the lowest pharmaceutical
consumption rate.

Turkish pharmaceutical industry

production is mostly realized:
under licenses agreements,
the industry has high added value,
huge production and export capacity.

HISTORY OF PHARMACEUTICAL
INDUSTRY
80% of the world pharmaceuticals production
is generated by developed countries.
Graph 1: World Pharmaceuticals Market

Turkish pharmaceutical industry

Pharmaceutical industry has become one of the most
progressive sectors in Turkey.
1928-1950: Fabrication period
International pharmaceutical companies : Bayer
(Germany), Aventis Pharmaceuticals, Inc (US), Pfizer
(US), Roche (Switzerland), Sanofi (France) and
Novartis (Switzerland).
The leading Turkish manufacturers are Eczacba,
Abdi brahim, Fako, lsan lta, brahim Ethem and
Bilim.
Medium level of concentration which is 33,41 CR4.

MARKET STRUCTURE
Market overview
The Ministry of Health, other government hospitals,
the Turkish Social Insurance Organization (SSK), and
the government's Pension Fund
Turkeys present population is at around 67 million
The number of people per hospital bed is 380
There are 83,200 doctors, 77,000 nurses and 14,700
dentists
The number of patients per doctor is 800
The population per dentist is 4,500

 Turkeys annual per capita health expenditure

is USD 160.
Europe-wide per capita spending on health
care goods and services is USD 2,140.
There are 22,000 pharmacies
in Turkey.
There are about 900 pharmacists
graduate from university each year.

Competition
Local competition is quite strong.
134 fairly large-sized companies
85 are pharmaceutical producers, 11
raw materials producers, and 38 are
importers.
952 million units of drugs and 4,382
tons of raw materials were produced in
Turkey in 2002.

The Porters diamond concept in a

pharmaceutical setting

Pharmaceutical production in Turkey

Years

Quantity

1998

923,000,000

1999

1,005,000,000

2000

1,100,000,000

2001

925,000,000

2002

969,000,000

Raw Material Production

Table 4 : Production of pharmaceutical raw materials in Turkey

Years

Quantity

1998

7,076

1999

5,552

2000

4,980

2001

4,382

2002

3,909

The production of raw materials in Turkey concentrates on many active

ingredients of pharmaceuticals, primarily antibiotics and analgesics,
by using fermentation, extraction and synthesis methods.

The Turkish pharmaceutical raw materials sector is represented by 11

plants of private sector and 1 plant of public sector.
The major characteristics of pharmaceuticals raw materials industry
are:
the investments are made at a great proportion
by privately owned companies,
the existing production capacity can be easily shifted
to various production possibilities.

Quality Standards
Investments for the development of technology in
the industry have been accelerated and today
production technology of the Turkish pharmaceutical
industry has reached world standards.
Turkey started recognizing patents from 1995.
Patent protected products will only become
more common between 2005 and 2007.

Pharmaceutical Consumption in Turkey

In 2002, sales level of pharmaceuticals in Turkey
is US$ 2.6 billions.
Public sector employees including civil servants
account for almost 80% of Turkeys
pharmaceutical consumption.
Antibiotics :18,2% Painkillers: 12,1%
The factors that affect the consumption: Invention
of new pharmaceuticals, economic and cultural
level of the country, population growth, average
life period, urbanization rate, income distribution.

EXPLORING CONDUCT
Pricing and paying-back policies
Prices are under control of the Ministry of Health

THE PAYING BACK APPLICATIONS FOR

PHARMACEUTICALS OF
Emekli Sand: Medicine expenditures of civil
servants, their relatives, widows and orphans
Has aggrements with 16,000 pharmacies
SSK: It has 261 pharmacies in its structure
Ba-Kur: It has its own pharmacies and health
institutions
Medicines can be bought from contractual
pharmacies
Complementary social security foundations:
Ordu Yardmlama Kurumu, Amele Birlii and
lksan

Foreign Trade

Exports: In 2003 total value of pharmaceutical industry exports

reached US$ 220 million.

Imports: Turkey's pharmaceutical industry imports have shown

an increase by years and reached to US$ 2,296 million in 2003.
2001

2002

2003

2004

Avr. yearly growth (%)

2004-2005

Imports

1,300

1,500

1,700

1,950

15

Local
Production

900

1,200

1,400

1,600

17

Exports

132

140

184

200

10

Total
Market

2,068

2,560

2,916

3,350

15

EXPORTS
Major export products are the ones containing
-Penicillin,
-Antibiotics,
-Alkaloid medicaments.
Turkey is now exporting various pharmaceutical products to 50
countries including developed countries like ,
Germany, the United States, Austria, Belgium, Finland,
the Netherlands, the United Kingdom, Switzerland,
Italy and Japan.

IMPORTS

In our country the pharmaceuticals industry, as in all developed

countries, is importing some products in finished forms.
forms

Major import products of the industry are medicaments

consisting of mixed or unmixed products.

Major countries from which pharmaceutical products imported

are the United Kingdom, Germany, France, the United States,
Switzerland and Italy.

Investments
The industry is continuously in loss due to unstable pricing policies
Graphs 2: Investments, 2001 ( US$ Millions )
Investments

80
70
60
50
40
30
20
10
0
US $ Mio.

1997

1998

1999

2000

2001

45,4

68,8

65,8

68,6

77

Year

R&D Strategies and Its Importance

The pharmaceutical industry does not
have enough funds to transfer on R&D
activities in Turkey.
In Turkey, the R&D activities for
pharmaceutical industry should start
immediately for the competition in
foreign markets .

Employment
The number of the total employees working
for the industry as of year 2001 is about
20,840.

Marketing Strategies
Medical representatives,
advertisements in medical, direct
mail, academic meetings, exhibitions
and other similar activities organized
during such meetings, distribution of
samples to doctors and pharmacists,
gifts and printed promotional
materiel.
The advertising of medicinal products
in newspapers without prior
permission by the Ministry of Health
is prohibited.

PERFORMANCE
Growth
If Turkey gives importance to the
growing up in the market and
rearranging plans, future of the industry
seems to be hopeful.
The developments concentrating on biotechnology is expected to provide
important contributions into the
economy and sector.

CONCLUSION AND FUTURE

EXPECTATIONS
Turkey needs to make both technical and marketing
investments.
It is expected that total pharmaceutical market by 10
percent increase each year will reach to 8.292 million
dollars in 2013.
After 2005, the number of the original
pharmaceuticals patented in Turkey and introduced
to the market will increase.

SWOT ANALYSIS
Strengths
- Availability of the capacity to meet the
domestic market in conventional products,
- Availability of the conventional drug
production technologies that all basic drugs
can be produced,
- Availability of qualified human source,
- Production of high quality products,
- Growth of domestic market development
(%10 annually).

 Weaknesses
-Inability to use the full production capacity
-No R&D activity for new pharmaceuticals
-Government interference
-Weak financial resources
-Insufficient investment level
-The limited number of patents taken by
national industry
-Inability to develop new technologies
-Inability to create funds necessary for
expensive research

 Opportunities
-Rapid development of information and
communication technologies and the easy
access to information
-Increase in the technology transfer
possibilities
-Positive changes in population and
demographical structure
- As a result of globalization, the availability of
capital seeking for investment opportunities
- The potentials gained by the our fellow
citizens in foreign countries for new
technologies

 Threats
-The exponential increase of science and
technology in the world
- Low purchasing power
- High inflation rate
- High cost of and limited credit
resources,
- Insufficient research consciousness
and appreciation
- Insufficient government resources
allocated to health and education