As the Middle East loses ground in the war on diabetes, one local company is investing heavily to provide a solution
Right now, the gulf is in the middle of a war that it looks unlikely to win. An estimated 20 percent — or roughly one in every family — of the region’s inhabitants now has diabetes, and, if current trends persist, that number is likely to double by 2030. Some estimates suggest that the UAE alone spends half a billion dollars every year combating the disease, but — despite the vast outlay, and the strain on Gulf exchequers — disease incidence has thus far shown no sign of waning.
One local company, however, has decided to take the bit between its teeth. Gulf Pharmaceutical Industries — Julphar — has already invested over $150m in the development of a new facility that is on the cusp of full production. So what will this plant be providing? Insulin — the hormone that is desperately needed by diabetes sufferers due to the fact that their bodies are unable to supply it.
“We have a social responsibility to secure medicines for the people of this region,” says HH Sheikh Faisal Bin Saqr Al Qasimi, the chairman of Julphar and a key proponent of the company’s new initiative. “Today, this technology is a highly sophisticated one — it needs a lot of capital investment. We have already committed more than half a billion dirhams to this product, which the market desperately needs. We think we will be able to serve areas where other companies have not reached.”
For Ras Al Khaimah (RAK)-based Julphar, the move to produce insulin represents something of a technical leap into the unknown. While at first one might question why no other firm in the region has attempted to manufacture a product when demand is so clearly sky-high, the fact remains that the insulin production process is technically very complex. Barely a handful of companies have mastered the art, and the majority of these only provide insulin to their own markets. Given that diabetes incidence is rising — especially in the Middle East and Asia — it seems Julphar is backing the right horse.
In particular, thinks Julphar CEO Ayman Sahli, the company’s lengthy experience in the local market means that its distribution channels are the envy of its big-spending multinational counterparts.
“We think of our area as an under-served area,” he says. “As we always say — if you look 500km outside the capital of many countries in the Middle East, is there insulin coverage? Are the doctors trained? I don’t think so.”
The facts would seem to bear out Sahli’s argument. More than three decades after Julphar started churning out pharmaceuticals from the first plant at its site on the emirate’s Airport Road, the company has a claim to having the most diversified sales base in the Gulf. It makes more than 800 drugs which are distributed over more than 40 countries, with Saudi Arabia now its largest market, buying up over 32 percent of its sales in 2011.
From its first plant back in 1980, Julphar is putting the finishing touches to its eleventh facility, all of which are based on the now-sprawling site in RAK. That plant, Julphar XI, will be dedicated entirely to insulin production. But Sahli says that insulin is just one piece in the wider diabetes puzzle.
“We view it as a platform — this is not a product, it’s a concept more than a treatment,” he says. “A patient may take insulin, but he might also take other products as well. Julphar will provide the whole basket of products, so what we are offering is a management of treatment, not just insulin.”
Eventually, say company executives, Julphar XI will be able to provide enough insulin to supply the entire region — using its tried-and-tested distribution network — and beyond. When fully operational, the plant will produce 1,500kg of crystals — which translates to around 40m vials.
Julphar’s ability to produce insulin has been built on the back of a strong track record in sales. Last year, the firm passed the one-billion-dirham ($272m) sales mark for the first time. Anti-infectives were the biggest seller, taking up a third of all sales, followed by ‘oral cavity and gastrointestinal tract’ medicines (fifteen percent), ‘nutrition and blood’ (13.9 percent) and skin medicines (13.2 percent).
“We have been growing double-digit for the last few years, and we will maintain this, even with the unfortunate disturbances in the market,” says Sheikh Faisal, when asked what he thinks the firm’s performance will be this year. “I hope we will continue that growth and be closed to AED1.2bn in sales.”
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