Pharmaceutical multinational corporations (MNCs) and their exit from low and middle income countries (LMICs): analysing the causes and consequences

Abstract

The Pakistani pharmaceutical industry cannot ignore the contribution of pharmaceutical multinational corporations (MNCs) in terms of innovation and access to advanced treatments. The sale of a pharmaceutical manufacturing plant by an MNC to a Pakistani company has again sparked a debate on why MNCs are closing manufacturing operations in the country. National firms are currently giving MNCs a tough time in Pakistan. Besides competition, MNCs face mergers and acquisitions that hinder the expansion of existing facilities. In the recent past, there has been a noticeable shift in the market shares of multinational corporations (MNCs) and local companies. The market share of national firms has gradually increased, reaching 74.51%, while the market share of MNCs has decreased, falling to 25.49%. These local companies have increasingly partnered with foreign companies through joint ventures, which has had a positive impact on their growth and market share. Nevertheless, the federal government recently deregulated prices for non-essential medicines, so it is expected that MNCs will show their commitment to Pakistan by investing in the country. Investing in new molecules and infrastructure is necessary for MNCs in order to maintain their position in the market. Infrastructure investment is crucial for the smooth operation of pharmaceutical firms. This includes the construction of state-of-the-art manufacturing facilities, the establishment of research and development centres, and the upgrading of technology.

Keywords

• Multinational corporations
• MNCs
• Pakistan
• drug pricing
• pharmaceutical marketing
• LIMCs