Dubai: One of the GCC’s bigger pharmaceutical companies, Avalon is launching a fourth production facility in Saudi Arabia to bring out oncology medicines and injectibles. The move into high value drugs is also part of the company’s move to break into new export markets, deemed as vital to keep its growth momentum going.
“Exports make up 10 per cent of our current top-line, and our products are there in 15 markets,” said Mohamed Maher Al-Ghannam, CEO of Avalon Pharma. “The target is to make that grow to 30 per cent of our revenue by 2030, which is why we need the new production capacities and new medicines as part of the mix. We started exports in 2004 and this is an area we need to get more out of.”
The new facility should become operational in the next two years.
Avalon Pharma, which is privately held, is into generic drugs, prescription medicines and also personal and skincare products. Gulf and Middle East based pharma companies are busy expanding their range beyond generic medicine production, which tends to be low margin, and get into higher value areas. Plus, Gulf health authorities are actively encouraging localized production of vital medicines where possible.
This is the script that Avalon too plans to follow. Another possibility could be alliances with international pharma companies on select drugs that can be produced in Saudi Arabia. But Al-Ghannam declined to say whether any specific partnership has been lined up.
Given its production interests in the biggest Gulf market provides Avalon Pharma with in-built advantages. The Saudi healthcare and pharmaceutical sector in particular has been attracting significant investment interest, and that too could count as a major plus for Avalon.
It’s also a formula that could be made to work in new markets. “We have made numerous strides in the UAE which have furthered our growth aims,” said Al-Ghannam. “We will also establish a country manager in Kuwait to help service Kuwait and Bahrain.
“Avalon Pharma has strengthened the global awareness of products ‘Made in Saudi’, offering new opportunities in the GCC and beyond.”
New target markets will include Egypt, Indonesia, Malaysia and Morocco. Then, there will a look into ‘expanding in different areas primarily through distribution partners with indirect follow up from Avalon’. These could be markets in East and West Africa, Libya, Algeria and the Balkan Peninsula.
But on one aspect, Avalon Pharma plans to retain the status quo – that of remaining as a private entity. Saudi Arabia has been seeing a rush of businesses going public, including some that are in the healthcare space.
Al-Ghannam, however, prefers Avalon to be privately-held. “That’s how it will be – going public is not our immediate focus.”