Argentina’s Pharmaceutical Exports Are on the Rise

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Researched by Industrialinfo.com (Industrial Information Resources, Incorporated; Houston, Texas). According to the final report submitted in 2005 by Argentina’s Industrial Chamber of Pharmaceutical Laboratories (ICAPL), Argentina’s laboratories made an 8% improvement by exporting medicines for nearly $380 million. This rise of Argentina’s pharmaceutical exports is a decisive landmark for the recovery of what at one time was a highly limited industry. It is partially due to the effect of the increase in the received refunds (between 2.5 and 5%) and the modification of the customs code to remove internal customs barriers.

According to a report submitted by ICAPL, “there are barriers that work against the growth of the exportation of nationally produced medicine”. Eduardo Franciosi, Chamber Executive Director, explained that the barriers that the industry deals with are mostly related to the fact that issues such as regalias (which are refunds that must be paid back to the country for the use of their natural resources), go beyond WTO requirements. Because of this, Franciosi said that the opening of foreign markets is also limited by the low refunds the industry receives directly, while other sectors normally receive a 5% refund).

In 2004, Argentina exported medicines for $350 million. Thirty-four percent of those profits belonged to Argentina’s Pharmaceutical Laboratories, while sixty-four percent were profits for foreign companies. Among the top twenty companies of this sector to provide a large volume of products and raw materials for the creation of the medicines, there were twelve multinational laboratories and eight national ones.

Argentina’s domestic sales are not significant when compared to the $125 billion sold by the international market. Today, 93% of the exports belong to finished medicines and vaccines, while there is still an ever increasing demand for individual analgesics, antibiotics, and raw materials.

Main Markets

Argentina’s mainly exports its medicine to buyers in neighboring South American countries such as Brazil, Mexico, Chile, Peru, Uruguay, and even as far away as Southeast Asia. Nonetheless, both the ICAPL and the Argentine Pharmaceutical Chamber say that the country is working on the expanding their exports to more non-traditional markets such as Turkey, South Africa, and Thailand among others.

Franciosi is optimistic about the future of Argentina’s Pharmaceutical Industry since the country has made important high quality technological investments in the industry and is expected to continue to do so.

Cut in Prices

In December, ICAPL and other chambers of the Pharmaceutical area reached an agreement about a 10% price reduction in more than two hundred medications. With this change, they stated that prices will be stable for at least sixty days. According to President Néstor Kirchner of Argentina, a raise in prices is only allowed if it is below the consumer’s price rate. This reduction is part of the anti-inflation politics implemented by the Argentine government just at the end of this passed year.

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