In a significant policy shift, the Pakistani government has deregulated prices for non-essential medicines, leading to the return of previously scarce drugs to the market. This move addresses longstanding shortages that had severely impacted public health and the pharmaceutical industry’s viability.

Addressing Critical Drug Shortages

For years, outdated price controls rendered the production of numerous medications financially unfeasible, resulting in widespread shortages. Patients were often forced to seek alternatives through black markets or counterfeit sources. The deregulation allows pharmaceutical companies to adjust prices of non-essential medicines in line with inflation and production costs, making it viable to reintroduce these drugs to the market.

Hybrid Pricing Model for Sustainability

While non-essential medicines are now subject to market-driven pricing, essential and life-saving drugs—over 460 in number—remain under strict price regulation. This hybrid model aims to balance affordability with the need to ensure a stable supply of medications.

Industry Response and Economic Impact

The policy change has prompted local manufacturers to resume production and encouraged multinational firms to reconsider exiting the Pakistani market. The pharmaceutical sector has witnessed a 20.62% growth in rupee value, with the market crossing the Rs1.049 trillion mark by March 2025. This growth is attributed to price adjustments and the reintroduction of long-unavailable drugs, indicating market stabilization.

Future Outlook: Investment and Employment

The deregulation is expected to attract investment in local Active Pharmaceutical Ingredient (API) manufacturing, reducing Pakistan’s 90% reliance on imports. Public-private partnerships are being explored to build domestic resilience and reduce exposure to global supply shocks. Additionally, the industry foresees job creation, particularly for young pharmacists, technicians, and quality assurance professionals.

Conclusion

The deregulation of non-essential drug prices in Pakistan marks a pivotal step toward revitalizing the pharmaceutical sector. By addressing critical shortages and encouraging sustainable production, the policy not only improves public health outcomes but also strengthens the industry’s economic foundation.