AJA Pharma Investing SAR 230 million in Saudi Arabia
Our group has been in the pharma industry for more than 25 years. We have been quite successful. We have partners who have contributed a lot to the pharma industry. In 2014, our turnover was almost SAR 2 billion. Recently we realized there was a need in the market, and among our partners, for local manufacturing.
Interview with Faisal Bindail, Deputy General Manager of AJA Pharma
The pharmaceutical industry in Saudi Arabia has been an area of strong growth. What is the outlook for the pharmaceutical industry in Saudi Arabia? What are the fundamentals of the industry?
The Saudi pharmaceutical industry is a growing sector, especially after the establishment of the Saudi Food and Drug Authority. This has encouraged local industry and the local manufacture of pharmaceutical products. Pharmaceuticals with local operations and manufacturing ability are a strategic sector in any country. They serve part of the local demand. Recently the Saudi FDA has put into effect some encouragement incentives. The Saudi government itself is encouraging and supporting local manufacturing in many sectors, including pharmaceuticals.
The Saudi FDA has supported domestic manufacturing by encouraging both the local and multinational companies to produce pharmaceuticals locally. This will result in increased jobs for young Saudis. It will involve technology transfer and localization of technology.
Your company is one of those bringing new, high paid jobs to Saudi Arabia. What is your strategy? How do you add value to the economy?
Our group has been in the pharma industry for more than 25 years. We have been quite successful. We have partners who have contributed a lot to the pharma industry.
In 2014, our turnover was almost SAR 2 billion. Recently we realized there was a need in the market, and among our partners, for local manufacturing.
Our company has been established as AJA Pharma to create a new manufacturing facility in Saudi Arabia. It will help satisfy the demand from our partners for local manufacturing. We will also meet the need for high quality product in the country. We also target the MENA region and certain other, selected parts of the world market.
Will you also develop innovation and R&D capabilities?
Yes we will have our own Research and Development department. This is not for the development of new chemical entities but to facilitate technology transfer. It will also ensure quality controls. The R&D Department will ensure that the local products are made according to the technological specifications in the transfer, while localizing the product.
What are the specific products you will produce in these new facilities?
First we are going to manufacture for others. There will be 4 different production lines. The first line will be solids, including tablets, capsules and most other solid products. We will also manufacture semi-solids, which are creams and ointments. We will also have a liquid production line. Finally we will have a production line for injectables, mainly lyophilised products, which are dry powder injectables.
What is the total investment value of this project?
The total budget for this plant is SAR 230 million.
Once this facility is online will it make a significant impact on the manufacturing capacity in Saudi Arabia? How will it affect the market?
The total annual capacity of our plant, including all 4 production lines, based on 3 shifts, will exceed 1 billion units.
Can the Saudi market consume this volume of production? Are you thinking of export?
We will definitely start in Saudi Arabia. Parallel to this we will target the MENA region. Then we will explore other, selected world markets. Our aim is to serve the market and provide top quality products in this country.
AJA Pharma is a relatively new company. Can you tell us a little about its history and vision? Whose idea was it and what was the rationale behind it?
As I mentioned earlier, as a group we’ve been in the pharma sector for over 25 years. We were mainly involved in the logistics, distribution and representation of multinational companies. We noticed the need for local manufacturing of our partners’ products. Currently, 80% of Saudi Arabia’s pharmaceutical demand is imported. Only 20% is locally produced. There is a huge market for locally manufactured product still wide open. Our rationale is that we can satisfy the needs of the market as well as that of our partners. Those are the 2 main reasons.
What made you choose Saudi Arabia as the site for your facility? Other countries in the region, like Jordan and Lebanon, are well known for their pharmaceutical industries.
First of all, we are a Saudi company. We had also noticed that Saudi Arabia has a need for this kind of business. In addition, Saudi Arabia has a very encouraging environment for the establishment for such businesses. These are the main reasons we chose to establish the facility in Saudi Arabia.
In addition, the industrial region in Ha’il, where we will have our facility, is a very promising area. It is fully equipped with all the utilities needed for manufacture. The government lends a lot of support to this industrial zone. There is a university and an international airport. It is served by railways, for the transport of goods. So all the services are available there. Ha’il is also attractive because there is a readily available workforce.
A lot of pharmaceutical companies in Saudi Arabia are building facilities and expanding capacity. With 80% of the market being served by imports, there is as you said, a huge potential for development for local companies. But with so many factories coming online, what is the impact on the market, in your opinion?
You are right about all the development activity, but the market is huge. Imports still make up 80% of the medications consumed in Saudi Arabia. That’s a significant number. What sets us apart is that our focus is not just on Saudi Arabia but also on other markets. In addition, what makes us unique is the production line we are creating for lyophilised products. No one else in Saudi Arabia makes those.
Can you tell us more about this specialty?
This is from our new production line for injectables. There are few facilities with this capability. We are using a very new technology, called Isolator technology. It will produce the best quality products. Injectables have a different sensitivity as compared to medications that are taken orally or applied topically. Competition is lower in injectables but it has to be of the highest quality. We will have injectables, and we will have the lyophilized or freeze dried products. This has not been available in Saudi Arabia up to now.
Can you talk to us about your long term vision for the company? How do you want to transform the company under your leadership?
We consider AJA Pharma as a company of the future. We have set a challenging objective and mission. We aim to establish the company as the ‘partner of choice’ in the pharmaceutical industry in MENA, especially in contract manufacturing.
Are you on the lookout for potential clients or have you already identified them and ready to go into production?
We have begun to receive interest from several partners and potential partners to locally manufacture their product at our facility. It’s in process. We have received audits from different companies to inspect our facilities in Ha’il. We have successfully negotiated an agreement with one of our partners to begin production of their product at our facility, when our facility is ready.
Can you tell us more about the audit? Did your facilities pass the audit?
Usually the auditors will go to the facility and check the quality of products manufactured there. They want to ensure that the facility applies the best standards of GMP (Good Manufacturing Practice). The inspectors inspect everything – the facility, the machinery, the equipment and the competency of the labor force. They also inspect the SOPs, Standard Operating Procedures. After the audit, our facility was approved.
Are you fully satisfied with the results?
Yes we are satisfied but we are also looking for continuous improvement. It is one of our objectives. We are looking to constantly improve our SOPs, to keep up with market needs and competitors.
Your industry is seeing tremendous growth and it has huge potential. It does not look as if the sector has many challenges. What would you identify as the main problems or challenges the industry faces?
There are always challenges in any industry. In pharma I would say the main challenge is to maintain quality in production. We also have to keep up to date with new technologies. We have to satisfy the requirements of the local health authorities. We have to keep on our toes to ensure that we are implementing best practices in production. Marketing practices are a big issue in pharma. In Saudi Arabia, the availability of a ready work force is also important. These are the challenges we face. But we are working on overcoming them and making a success of our business.
Are there any international benchmarks or models that you admire and would like to replicate in your operations?
We usually follow the European benchmarks, especially as it relates to quality control. It has been applied to the regulatory protocols and GMP implementation of manufacturing processes in our facility. All our machinery and equipment is from Europe. That is our benchmark that is where we want to be in terms of the quality of our product.