Egypt’s pharmaceuticals sector is currently operating under exceptional circumstances amid the repercussions of the war unfolding in the Middle East, Hossam Abul-Enein, a board member of the Pharmaceutical Industry, Cosmetics, and Medical Supplies Chamber at the Federation of Egyptian Industries, told Al-Ahram Weekly.
He explained that the pharmaceuticals sector is subject to a mandatory pricing system, unlike many other goods and services. This means that any increase in production costs represents an additional burden on the industry.
He pointed out that the repercussions of the war on Iran have cast a shadow over global shipping activity, with the cost of shipping a single container rising by around $3,000, a development that will also negatively affect production costs.
The duration of shipping is expected to increase from 30 days to about 50 days if shipments are rerouted via the Cape of Good Hope, placing additional pressure on production, particularly as the sector relies on importing about 70 per cent of its production inputs, he said.
The pharmaceuticals industry depends on importing active ingredients, with imports accounting for as much as 90 per cent of inputs from China and India, according to Abul-Enein.
The continuation of the war will have potentially negative impacts on production and the availability of medicines in the local market, he said.
Abul-Enein also noted that most of the medicines currently in short supply in the local market are highly priced imported drugs, adding that multinational companies no longer find local production attractive, especially given the declining appeal of local prices.
He stressed that the burdens on drug production costs in factories are increasing day by day, influenced by several factors including the rise in the minimum wage and the resulting increase in social insurance contributions borne by producers, in addition to the repercussions of higher fuel prices and the rise in the dollar exchange rate.
Mohy Hafez, head of the Export Council for Medical Industries, told the Weekly that there are no indications that companies are moving to raise drug prices in the local market.
He explained that the dollar at around LE52 remains within a safe range, especially as the last price adjustment for medicines took place when the dollar was close to LE50.
The fact that the Houthi group in Yemen have not intervened in the current war helps to ensure the continued import of production inputs. Houthi attacks on shipping through the Suez Canal following the war in Gaza in 2023 disrupted shipping through the Suez Canal.
Hafez expressed concerns over the possibility of the war expanding, potentially affecting supply chains and logistics, increasing the likelihood of shortages of raw materials and leading to more serious crises than the issue of price adjustments.
He said that companies will seek to absorb the impact of higher fuel prices by eating into their profits. Medicine prices have risen three times since the decision to liberalise the exchange rate in 2016, according to Hafez.
Drug shortages are not new in the market in Egypt, he said, and they often appear for imported medicines that have no local equivalent. In some cases, shortages may occur for a specific brand of medicine even if alternatives and generics are available.
He called for addressing price distortions in the pharmaceuticals market in a way that will help to eliminate price differences between medicines and their alternatives.
According to Hafez, the Export Council is targeting growth of between 25 and 30 per cent in the sector’s total exports this year, after recording exports worth $1.3 billion in 2025.
He noted that Saudi Arabia is the largest importer of Egyptian medicines among the Arab countries, accounting for the largest share of the sector’s exports.
* A version of this article appears in print in the 19 March, 2026 edition of Al-Ahram Weekly
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