From just six brands in 1990, the Saudi Pharmaceutical Industries and Medical Appliances Corpo-ration (Spimaco) has come a long way, producing today 39 leading products.
During the decade it has been in existence, the company has fulfilled its founders' objective of serving the local market, reaching overseas consumers and contributing to Saudi Arabia's industrial infrastructure.
It is not only the largest Saudi pharmaceutical company, but also the only one to cover all major categories of drugs including ones in the analgesics, antibiotics, cardiovascular, respiratory and hormonal categories. The company is also involved in the production of medical equipment.
Spimaco is a joint stock company with Acdima (Arab Company for Drug Industries and Medical Appliances) the main shareholder, followed by investors from among the Saudi business community and the general public. The latest annual report showed total sales in 2000 were SR474 million ($126.3 million) while profits were SR 67 million, 10 per cent higher than in 1999.
The manufacturing facilities are spread out over 150,000 sq m in Al Qassim, 320km from Riyadh and in the centre of the Kingdom and region. The promoters left nothing to chance, ensuring that the production facilities would meet the highest standards one expects of a pharmaceutical plant. They selected a consortium of Roussel Uclaff (now part of Aventis) and UHDE, a German engineering firm, to provide the design. Says Mohammed Abdul Jabbar, Spimaco's deputy manager for marketing and business development: "Human intervention was reduced to the minimum through automation and closed systems. Attention to detail during the design stage and careful selection of contractors produced facilities that conformed to the highest CGMP (Current Good Manufacturing Practices) standards, but which were very efficient to operate and maintain."
The product range includes antibiotics, oral solids and liquids, ointments and creams, aseptics and antiseptic items and suppositories. The production capacity for antibiotics is 200 million capsules and 8 million bottles. Some of its popular brands are Rofenac, Klavox, Ceclor, Fevadol and Lorine. Spimaco's major partners are GS & K, J & J, Pfizer, Novartis, Roche, Anevtis, BMS, Biochemie and Schering Plough. Research and development are accorded high priority. Teams of researchers are working day and night to develop new formulations. Clearly Spimaco is proving a model to companies aspiring to enter the same business and replicate its success.
The sales force has more than doubled during and a new marketing strategy has been put in place during the past five years. "The rapidly evolving business demanded that there be a split of the marketing and sales team into two major groups to look specifically after the private and public sector markets," said Abdul Jabbar.
A factor in the company's good performance is the selection of parties for business alliances. Abdul Jabbar cited the joint-venture Enayah company as an example of good partnership. Enayah was set up through the joint efforts of Kimberly Clark, the Olayan Group and Spimaco itself. The company specialises in the production of surgical goods such as gowns, patients' sheets, head and shoe covers and surgery kits. The coverings, made of a specially designed fabric having three layers of polypropylene, protect surgeons and patients from infections that could be transferred from one to the other in the vicinity. Enayah products are widely used in Saudi Arabia and other GCC states.
Spimaco started exporting its pharmaceuticals in 1993 by signing five distribution agreements and appointing authorised agents in all the GCC capitals. In the second phase, it started registering its products in the Gulf states. The next step is to enter adjacent Arab states.
In Algeria, Spimaco has established a company called Spimaco-Algeria whose role is to import, market and distribute Spimaco products in the Algerian market. Spimaco is also an investor in an Algerian manufacturing concern that is expected to start commercial production within the coming two years and export to North and West-Central Africa.
The company is also developing markets in Sudan, Nigeria, Ghana, Kenya, Tanzania and Senegal as well as in Romania and Uzbekistan.
Spimaco is reckoned as one of the great success stories of Saudi Arabia for the progress it has achieved in a difficult and sophisticated field. The company has been awarded the Environment Compliance Certificate, the King Fahd Quality Award and the ISO 9001 certification. The Saudi government used the company facilities as a training model for Ministry of Health officials.
Abdul Jabbar feels companies like Spimaco would make greater headway, if governments in the region gave a helping hand. He has recommended they encourage import substitution, provide legal protection to investments through patent cover and finance, grant facilities for the early registration of drugs and adopt a preferential price policy.
