Pharmaceutical industry in Kazakhstan: insufficient local production, need for research

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ASTANA. KAZINFORM – Kazakhstan has 158 pharmaceutical manufacturers, 42 specialize in the production of medicines and 116 are manufacturers of medical devices. The volume of production in five months of this year reached 30,000 tons worth 67.1 billion tenge (US$152.1 million). More about the current state of pharmaceutical production in Kazakhstan, gaps and challenges is in the latest article of Kazinform.

Health and well-being of citizens

Prioritizing the health and well-being of its citizens is important for any country and central to this goal is drug safety and the production of high-quality medicines. The COVID-19 pandemic revealed how unprepared was pharmaceutical industry in Kazakhstan, with shortage of essential drugs and unreasonable rise in prices. While the pandemic may be over, lessons are still to be learned.

In his address to the nation in September 2021, President Kassym-Jomart Tokayev instructed to increase the share of domestically produced medicines and medical devices to 50 percent. He also stressed the need to attract investors, ensure the transfer of technologies and latest developments, and expand the volume and range of off-take contracts with domestic manufacturers.


In recent years, Kazakhstan, like many countries around the world, has faced unprecedented challenges - the pandemic, external and internal shocks. All had a direct impact on the country's economy.

There is a decrease in purchasing power in the national currency, inflation, which hit 20.3 percent in December 2022 and increase in the consumer price index of 120.3 percent in December 2022, which negates the recorded growth of per capita income. This all can have a direct impact on the health of population, including making it more difficult for people to afford the medications they need, especially those with chronic conditions.

Kazakhstan’s pharmaceutical production

In 2022, the volume of production of pharmaceutical products in monetary terms amounted to 162.6 billion tenge (US$386.6 million), decreasing by 36.1 billion tenge (US$81.8 million), or 18.2 percent compared to 2021, when pharmaceutical companies produced products worth 198.7 billion tenge (US$450.4 million).


Today, Kazakhstan boasts a diverse range of pharmaceutical companies, both domestic and foreign, producing a wide array of medicines to meet the population's healthcare needs.

Top pharmaceutical producers in terms of regions are Shymkent, producing drugs worth 57.6 billion tenge (US$130.6 million), Almaty region - 39.5 billion tenge (US$89.5 million) and Almaty city - 21.7 billion tenge (US$49.2 million).

Still, Kazakhstan heavily relies on imported medicines, which accounted for 2.4 percent of the total imports in 2022, according to the Bureau of National Statistics.

According to the data of the State Revenue Committee, export of pharmaceutical products for five months of the current year totaled $6.2 million, of which $6 million to the Commonwealth of Independent States (CIS) and the remaining $0.2 million to other countries.

«For 2022, exports of pharmaceutical products totaled $32.2 million, of which $24.6 million to CIS countries, and $7.6 million to other Asian and European countries,» the Ministry of Healthcare said in a comment for this story.

According to the Proxima Research International analytical company, volume of the market hit $2.2 billion, which is 7.4 percent less compared to the previous year. In physical terms, its volume decreased by 11.3 percent from 1,037 million packs in 2021 to 919 million packs in 2022.


At the same time, in monetary terms, there is growth in the retail segment of the market and a slight decrease in the segment of purchases within guaranteed volume of free medical care and in the system of mandatory social health insurance.

State regulation of prices

According to the Kazakh Healthcare Ministry, state regulation of drug prices is carried out within the guaranteed volume of free medical care and in the system of mandatory social health insurance, wholesale and retail segment of the pharmaceutical market.

Kazakhstan regulates prices for medicines through a system of ceiling prices and markups. The ceiling price is the maximum price that a medicine can be sold for, and the markup is the amount that a wholesaler or retailer can add to the ceiling price to cover their costs and make a profit.

Since 2009, Kazakhstan has been adopting ceiling prices for international non-proprietary names of medicines used within the guaranteed volume of free medical care per the Code of Kazakhstan on the Health of the People and the Health Care System.

The system of ceiling prices and markups is designed to ensure that medicines are affordable for the Kazakh people, while also allowing pharmaceutical companies to make a profit. The system is also designed to prevent price gouging by wholesalers and retailers.

In 2020, Article 245 of the code was amended to approve, upon agreement with the antimonopoly authority, the maximum prices for medical products for retail and wholesale sale, as well as within the guaranteed volume of free medical care and the system of mandatory social health insurance, including medical devices.

Prices for exported domestically produced medical products, however, are not regulated by the rules.

Local production is not sufficient

Kazakhstan set a goal to bring the share of domestic production to 50 percent in the pharmaceutical market by 2029

The Ministry of Healthcare has so far adopted a roadmap outlining measures to achieve this goal.

Pharmaceutical clusters in the cities of Astana, Shymkent and Aktobe were also established to drive research and development (R&D) and improve the competitiveness of domestic production of pharmaceutical and medical industry.

Each cluster will have its own specifics. Notably, the Shymkent cluster is aimed at the production of medicines, the Aktobe cluster zone is aimed at the production of medical equipment, and the Astana cluster will focus on intellectual capacity of the pharmaceutical industry.

Astana, Aktobe and Shymkent were chosen due to the presence in these regions of large medical and technical universities, production sites and clinical bases in these regions.

Pfizer and Korea’s Samsung Madison are implementing projects on localization of production of original medicines and high-tech medical equipment in the territory of Kazakhstan.

While these measures may sound promising, the country has still to do a lot to promote innovative technologies and R&D.

Globally, biopharmaceutical industry witnesses the biggest investments in R&D. According to the International Federation of Pharmaceutical Manufacturers & Associations, of all industrial sectors, the biopharmaceutical industry has consistently invested the most in R&D, even in times of economic turmoil and financial crisis.

In 2020, the global research-based biopharmaceutical industry invested approximately $198 billion in R&D for biopharmaceutical, surpassing the annual expenditures of other high-technology sectors, including aerospace and defense, chemicals, and software and computer services.

Upcoming investment projects

According to the data from the ministry, nearly 42 production facilities for medicines and medical devices, including those with the participation of major foreign companies, are expected to be commissioned. Of these, 19 specialize in the production of medicines and 23 – in medical devices.

Projects on production of innovative medicines, ultrasound devices and pharmaceutical products are underway with German, Japanese, South Korean and Turkish companies.

The Kazakh ministry has also been negotiating with Big Pharma pharmaceutical companies on investment projects.

Four projects were initiated with Roche company, a Swiss multinational healthcare company that operates worldwide in more than 100 countries. The company’s CEO Christoph Franz met with President Kassym-Jomart Tokayev in December 2022, briefing him on the implementation of the project to localize the production of innovative anti-tumor drugs and the development of innovative methods of detecting malignant neoplasms with the Kazakh Research Institute of Oncology and Radiology.

In 2023, with the support of the company, a training center for laboratory diagnostics will be created at the Nazarbayev University School of Medicine to improve the qualifications of local specialists.

Negotiations with AstraZeneca company are in progress, whereas a confidentiality agreement was signed with Pfizer company and the road map for implementation of the project of contract production of Prevenar-13 pneumococcal vaccine was approved.

Polpharma Group, whose Shymkent-based Santo plant is among the country’s retail leaders, also expressed its readiness to invest in the development of innovative potential of the cluster and R&D sector.

Drugs safety

Medicines are subjected to rigorous testing to ensure their safety, efficacy, and compliance with established standards. State registration is an important part of that process, which is preceded by a comprehensive assessment of their efficacy, safety and quality, resulting in the admission of the medicinal product to the market.

These tests encompass stability studies, bioequivalence studies, and pharmacovigilance.

«It should also be noted that the determination of the quality of medical products is carried out through safety and quality assessment of each series of imported or manufactured registered medical product. In the course of the assessment, each series of registered medicinal product is examined, based on the results of which the compliance of the product with safety and quality standards is either confirmed or not,» said the ministry.

Pharmacovigilance is also an essential tool in the control of safety and efficacy. Kazakhstan maintains a robust pharmacovigilance system to monitor and address the safety of medicines even after they have been approved and made available in the market.

As part of pharmacovigilance, 34 registration certificates were suspended based on the results of the assessment of the benefit-risk ratio in 2022, and amendments to the instructions for medical use were recommended for 971 medical products.

Every year, the National Center for Expertise of Medicines conducts nearly 6,000 expert examinations of medicines. At least 117 medicines were denied admission to the market.

According to the results of 2022, 2,488 items of non-compliant products were denied admission under the quality assessment procedure. On average, 2 percent of negative decisions are based on the results of the quality assessment procedure for each series and 3 percent are based on the samples taken from the market that do not meet the established quality requirements.


Such system of selection of medicines and medical devices from the market was introduced to strengthen quality control of medicines. In 2022, 1,500 medicines and medical devices were sampled from pharmacies and warehouses and 41 items did not meet the requirements and were subsequently disposed of.

Yet, some experts say that the registration process can be cumbersome and very long taking up to four years, even for medicines that have already passed registration in the United States and the European Union.

«Is it necessary to check those drugs that have passed all procedures in the EU or the US? Some countries in the world have gone the way of recognizing such drugs, however, in Kazakhstan drugs are thoroughly tested. Why do we delay the processes? American or French patients have already received new highly effective drugs, while Kazakhstan’s patients have to wait four or five years. But some might not have time to wait for it,» said Vyacheslav Lokshin, President of the Association of International Pharmaceutical Manufacturers in Kazakhstan.


Cooperation with international organizations

Kazakhstan works closely with international organizations to improve the health care system, including in areas of quality assurance, safety and effectiveness, as well as the registration of medicines and medical devices.

As part of pharmacovigilance and monitoring of adverse effects of medicines and medical devices, it cooperates with the World Health Organization (WHO) and is a member of the WHO’s Program for International Drug Monitoring.

Kazakhstan has also sent more than 300 reports through the VigiFlow system, a web-based pharmacovigilance management system developed by the Uppsala Monitoring Centre (UMC) and the WHO for national regulatory agencies to strengthen post-marketing surveillance. It is a user-friendly platform that allows users to collect, process, analyze, and share data on suspected adverse drug reactions and adverse events following immunization.


VigiFlow uses standardized medical terminologies such as WHODrug Global (a drug reference dictionary) and MedDRA (the Medical Dictionary for Regulatory Activities, a multilingual dictionary of standard terminology) to ensure that data is consistent and comparable across different countries.

The ministry said preparations have also begun for the implementation of the WHO global campaign on pharmacovigilance and monitoring of adverse effects of medicines.

Kazakhstan has made commendable efforts in establishing a strong pharmaceutical industry that emphasizes local drug production and ensures high standards of drug safety. Yet, reality shows fundamental changes are needed to ensure a robust regulatory framework, rigorous quality control measures, and a vigilant pharmacovigilance system.


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