FY26: pharma output falls 8.87% and exports drop as the Afghan market stays shut

FY26 was a difficult year for Pakistan’s pharmaceutical output and exports, even as retail sales and company profits rose.

Production

According to Pakistan Bureau of Statistics data reported by INP-WealthPK in September 2026, pharmaceutical output fell 8.87% in FY26, while large-scale manufacturing as a whole grew 4.98%. Pharmaceuticals subtracted 0.54 percentage points from overall growth, and June 2026 output was down 17.61% year on year.

Exports

FY25 had been a record year, with exports up from $341 million in FY24. The FY26 fall followed the closure of the Afghan border crossings, Pakistan’s largest medicine market — see our article on the border closure.

The roadmap

Despite the setback, targets are rising. The roadmap reported by INP-WealthPK runs from the FY25 base to $2 billion, then $3 billion within three years through PharmEx, and $10 billion within eight years. The sector has 662 manufacturers; eight companies hold WHO, PIC/S or MHRA approvals, with 10–15 more expected by 2028.

Climbing the value chain

TDAP research officer Farah Hanif said the industry must “climb the value chain” into complex generics, biosimilars, vaccines and specialised injectables. Dr Muhammad Sajid of the University of Lahore argued that credible bioequivalence and bioanalytical facilities are needed to meet demanding registration requirements.

Reading the contradiction

FY26 produced headlines that seem to contradict each other: record sales and profits, but falling output and exports. The explanation lies in what each figure measures. Retail sales are measured in rupees, and rose mainly because of higher prices. The production index measures physical output, which fell — partly because exports to Afghanistan, a large share of foreign sales, were interrupted, and partly because domestic unit sales barely grew. Profits rose because prices and margins improved and financing became cheaper. All of these can be true at once.

The export roadmap in context

The targets imply growth far faster than the industry has achieved so far. Reaching them would require more products registered in more countries, more plants with international approvals and a move into higher-value products.

What climbing the value chain means

• Complex generics — products that are harder to copy, such as modified-release formulations, inhalers or combinations, where fewer competitors operate.
• Specialised injectables — sterile products that require Annex 1-level facilities.
• Biosimilars and vaccines — biological products with high entry barriers and high value.
• Proof of equivalence — credible bioequivalence studies and bioanalytical laboratories, which many export markets require before registering a generic.

Only a handful of Pakistani companies hold WHO, PIC/S or MHRA approvals today. Increasing that number is the most direct way to widen the list of markets open to Pakistani medicines — and it is where DRAP’s reforms and companies’ investment plans meet.

What suppliers should watch

For equipment, laboratory and packaging suppliers, the export push points to where demand is likely to come from: upgrades that help plants obtain international approvals, sterile capacity for injectables, analytical and bioequivalence capability, and serialisation for both domestic rules and export markets. Companies that can explain how their products help a manufacturer pass an international inspection will find receptive buyers.

What it means

Higher-value exports need higher-specification plants, laboratories and quality systems — exactly what suppliers bring to Pharma Asia 2026. See also the WHO Maturity Level 3 drive.

Sources

• INP-WealthPK, “Pakistan’s pharma industry faces value-addition test as export targets rise”, 2 September 2026
• ProPakistani, “Pakistan’s pharma sector delivers record-breaking $457 million in exports for FY25”, 3 August 2025