"In 10 years, we will see more regulation in the OTC market, which will create new opportunities if we do things right. We will have a favorable climate to grow from our foundation and our main strategy will be to add products to our portfolio based on our capacity and ability."
How has the market evolved over the last five years and what are some of Ali Raif’s recent milestones?
Since 2014, the Turkish pharmaceutical market has been growing despite facing difficulties. Over the last 10 years, the market has tripled in turnover and grown from 1.4 billion units to 2.4 billion units. This growth can be attributed to an ageing population and improved socioeconomic conditions in Turkey as well as inflation and an increase in drug prices.
We began our business by representing multinational companies and producing under their license in Turkey. Today, we represent many companies as a distributor by marketing their products. In the 1990s, we established our own R&D facility and entered into the generics business. Today, our in-house portfolio of products contributes to 70% of our turnover.
What is your strategy to differentiate your products and meet market demand?
We are focused in a few selected fields, namely cardiology, gastroenterology, anti-diabetes and CNS. In 2018, we added a line of OTC medications. The new products coming into the market are no longer blockbuster products that have huge sales, so we are flexible on seeing products and opening a line if we see potential in registering and marketing the product.
What opportunities do you see in the market over the next 10 years?
In 10 years, we will see more regulation in the OTC market, which will create new opportunities if we do things right. We will have a favorable climate to grow from our foundation and our main strategy will be to add products to our portfolio based on our capacity and ability.
Low margins and profitability leave little room for high spending on R&D. However, Ali Raif’s R&D center has been approved by the MOH in 2017. Could you elaborate on the focus taken in R&D?
In 2014, we established an R&D department and, in 2017, we became a certified R&D center. We have a well-sized R&D team that is working productively. With low margins, it is difficult to invest in R&D and it is helpful that the Government provides grants to the industry to encourage R&D. We have several new products in the pipeline, and we are chasing drugs going off patent while searching for new formulations and new applications based on recent technology, such as combination products and complex generics that require more innovation. Price and feasibility are a key factor that determines whether or not we will be able to manufacture our pipeline products.
Currently, we are considering expansion to increase our production capacity. We are not a part of the biotechnology wave and we are waiting to see how it pans out before investing in it or finding a licensed partner.
What is your vision for Ali Raif over the next five years?
Our vision is to maintain a work environment where our employees are happy and feel that Ali Raif is a safe place to work. We are examining the prospect of in-licensing by having more global partners or European sources produce for us. We are flexible and open to importing if we find the right product and company that is seeking distribution in Turkey. We are also open to manufacturing and exporting products if companies are willing to transfer their technology to us. Some multinational companies approach us to market their products and, if the product fits with our line, we take on the task.
Do you have a final message for our readership?
The Turkish pharmaceutical industry has a long tradition with Ali Raif being present since 1928. We have tremendous experience with Western multinational companies and we have grown together with our competition. Over the last 100 years, Turkey has learned to manufacture pharmaceuticals and conduct R&D. We have served the local market for many years and now we are seeing our export business grow as well. Our production facilities are recent with new GMP technologies and a team of hard-working people, making Ali Raif a reliable partner.