A key milestone in Abdi İbrahim’s over-100-years evolution is the opening of the biggest biotech drug manufacturing facility, AbdiBio. Can you tell our readers about the significance of this facility?

In order to grow our business in a highly competitive environment we have always followed trends closely and diligently sought to prepare for the future. We realized that biologicals currently represent 20% to 30% of the market and will continue to grow their market representation in the future. Today, more than 50% of R&D expenditure in multinational companies is focused on biological products. In the same vein, Abdi İbrahim, decided to enter the biosimilar drug manufacturing field in order to stay competitive and to grow our business.

The government of Turkey is trying to control health costs, but the social security system is unique, bringing coverage to approximately 95% of the population. Under this system, all drugs are free of charge, especially when a patient is hospitalized. To reduce the trade deficit, the government is encouraging companies to invest in the pharmaceutical industry, and they are enthusiastically promoting the biologicals segment. We decided to invest in this segment back in 2010. The first step was to connect with companies around the world who are already operating in biosimilars. Secondly, we invested in production and established the largest biotech drug manufacturing facility in Turkey. The last component, and just as important, was to invest in people, and currently we have 30 employees in our bio facility. The facility is not yet in operation, but we continue to invest in the education and leadership skills of our employees.

At AbdiBio, established with an investment of US$100 million, we will carry out all production processes, from the cell bank to the end product. In this facility, equipped with the latest technology, we will produce products for the treatment of oncology, diabetes, rheumatology, central nervous system, ophthalmology and blood diseases.

Our facility boasts an indoor area of 13,000 square meters and will operate with an annual production capacity of 11 million vials, 9 million syringes, 22 million cartridges and 1 million lyophilized products. Thanks to agreements we have made with five different global companies, we have seven biosimilar products slated for marketing authorization in the fields of rheumatology, immunology, dermatology, gastroenterology, ophthalmology and oncology, in addition to a biosimilar product already licensed and released to the market.

When does Abdi İbrahim expect to launch its first biosimilar product?

When Abdi İbrahim decided to invest in the biosimilar field, we defined three key phases for production. The first phase was to conduct a technology transfer with a company which is already operating in the market, with the aim of preparing a fill and finish product. The second phase was to sign a licensing agreement for manufacturing from cell line. The third phase is to develop our own biosimilars. We anticipate that we will be ready to produce our first fill and finish products by 2021 and we hope to be launching our own biosimilars by 2025. Abdi İbrahim is also in contact with multinational companies and our bio facility will be used for toll manufacturing of biological products.

How do you think Turkey’s localization policy might shape the dynamic between local players and foreign players?

The localization policy in Turkey was mainly designed for chemical products, but has now flowed over into the biopharmaceutical area. Looking at MOH’s localization criteria, it shows that in the near future, most biologicals will not need to be localized. On the other hand, there are some biopharma companies who are willing to localize their products for the Turkish market, but they are also willing to use Turkey as a hub because of its geographical advantages. Many companies are keenly aware of Turkey’s advantages in terms of production, logistics and clinical studies, and therefore they want to localize their products in the country. Abdi İbrahim, as a 100% local pharmaceutical company, is supporting the country’s localization policies as we believe that this will help to close the trade deficit and bring technologies and expertise to Turkey.

In previous years, only 10% of Abdi İbrahim’s revenues originated from international sales. How has the balance between domestic and international markets evolved, and what are the primary markets of interest for Abdi İbrahim in coming years?

We have invested in production sites in Kazakhstan and Algeria in order to bring ourselves closer to these markets. In 2015, only 10% of our overall revenues originated from international markets which are contributing approximately 20% to our overall revenues today.

We operate in 12 countries outside of Turkey with our own sales teams. We export to more than 60 countries. We are proud of exporting to developed and pharmaceutically advanced countries such as Germany, Canada, the UK and France. Our factory in Kazakhstan, established with an investment of US$60 million, is manufacturing Abdi İbrahim products both for the local market and exporting to neighboring countries. We are also aiming to export from our pharmaceutical facility in Algeria, which we established with an investment of US$50 million, to other African countries in near future.

At the end of this year, we anticipate raising our international sales by another 10% compared to the previous year, to approximately US$100 million. Our medium-term goals are to expand our existing markets, enter new markets, and increase our international sales to US$250 million. In this sense, our primary target markets are EU countries and the USA. We consider every option in our ambition to grow in these geographies, including buying a company.

As a strategic goal, we aim for half of our revenues to stem from our international business after 2025. While international operations are very important for us to grow further, Turkey will always be Abdi İbrahim’s first priority. 

How do you believe the Turkish pharmaceutical market will change moving forward?

I believe that Turkey will see some changes in the social security system, which is currently too difficult to uphold in the long term. We also expect changes to occur in introducing OTC legislation. Many products will no longer be reimbursed and out of pocket payments are predicted to rise. Biologicals will shape the future of the pharma industry, and I believe companies should be investing so as not to be left behind. Production capabilities and capacity in Turkey will attract other countries to bring their production here.