Pharmagen Limited (Hereinafter referred to as “the Company” or "Pharmagen" or “PL”) was incorporated in Pakistan on November 24, 1990, as an unquoted Public Limited Pharmaceutical Company.

The Company began its commercial operations in 1990 and has since evolved into a leading pharmaceutical manufacturer with a state-of-the-art production facility designed in full compliance with Good Manufacturing Practices (GMP). Over the years, PL has demonstrated consistent organic growth, strategically expanding its operations and diversifying its product portfolio to address the dynamic needs of the healthcare market. Through continuous investment in quality, innovation, and technology, the Company has earned a strong reputation for excellence, reliability, and commitment to improving patient outcomes. Today, PL stands as a trusted and respected name within the pharmaceutical industry, recognized for its dedication to developing high-quality, effective, and affordable healthcare solutions.

The Company is engaged in the manufacturing and sale of Active Pharmaceutical Ingredients (APIs) and finished Pharmaceutical products through its wholly-owned subsidiary, Moringa Pharmaceuticals (Pvt.) Ltd. Over the years, PL has established itself as Pakistan’s leading API producer and a trusted supplier to both multinational and local Pharmaceutical Companies. The Company’s modern manufacturing facility, located on Lahore–Kasur Road and spread across approximately ~8 acres of land, is equipped with advanced technology and operates in compliance with stringent quality and safety standards. Recently, PL successfully completed a major capacity expansion project for Paracetamol API, further strengthening its production capabilities and supporting the growing domestic and export demand. Looking ahead, PL is actively pursuing EDQM (European Directorate for the Quality of Medicines) certification — a milestone that will enable the Company to access new international markets, particularly within the European region. This strategic initiative reflects PL’s long-term vision of becoming a globally recognized Pharmaceutical manufacturer known for quality, reliability, and innovation.

PL’s ownership structure reflects a strong foundation of family and strategic institutional shareholding. The family of Mr. Parvez Hussain serves as the principal shareholder group, holding  ~44% of the Company’s total shares. The family of Mr. Shamim Ahmed represents the second-largest shareholder group, with an ownership stake of around ~30%. In addition to these major holdings, Mr. Rahim Khan Trust / Kashmir Education Foundation retains a significant ~15% ownership interest, underscoring the Company’s association with reputable institutional partners. The family of Mr. Rasheed Khan holds an additional ~7% stake, while the remaining ~4% of shares are distributed among other minority investors. This diversified yet cohesive ownership structure reflects PL’s stable governance framework and long-term commitment to sustainable growth and strategic collaboration.

The Company’s ownership structure remains stable, supported by the active participation of the second generation of the founding family in key management roles. Among them, Mr. Usman Hussain, currently serving as Head of Marketing, has emerged as a dynamic leader and is widely regarded as a potential successor to guide the Company into its next phase of growth. His involvement reflects the family’s continued commitment to the strategic direction, values, and long-term vision established by the founders. To ensure seamless leadership continuity and strengthen organizational resilience, it is recommended that PL formulate a formal succession plan. Such a framework would establish clear processes for leadership transition, executive development, and talent retention—thereby ensuring that the Company’s growth momentum, operational stability, and strategic vision remain uninterrupted. Implementing a well-defined succession plan will not only safeguard PL’s legacy but also reinforce stakeholder confidence in its governance and long-term sustainability.

PL’s ownership structure embodies a combination of strong business acumen, strategic foresight, and a steadfast commitment to sustainable growth. The inclusion of  SAMI as shareholder marks a significant milestone in PL’s evolution. This partnership brings with it a wealth of industry expertise, operational excellence, and strategic insight, enriching PL’s governance framework and decision-making capabilities. The infusion of SAMI’s knowledge and experience complements the existing ownership’s long-term vision, creating a powerful synergy that enhances PL’s ability to navigate complex market dynamics, drive innovation, and pursue new growth avenues. Together, this balanced mix of seasoned leadership and fresh perspectives positions PL to further strengthen its competitive advantage, expand its market presence, and reinforce its standing as a trusted leader in Pakistan’s Pharmaceutical Industry.

The Company’s sponsors exhibit considerable financial strength, underpinned by their diverse investments across multiple sectors and a well-established financial profile. This financial robustness not only provides stability but also enables the sponsors to support strategic initiatives and growth opportunities effectively. A key milestone in their expansion strategy was the acquisition of Moringa Pharmaceuticals (Pvt.) Ltd. in 2017, a move designed to strengthen their foothold in the Pharmaceutical Sector and broaden their product portfolio.  Despite the strategic intent behind this acquisition, Moringa Pharmaceuticals is currently facing financial challenges and has yet to reach its breakeven point. The difficulties stem from various operational and market factors that have impacted the subsidiary’s profitability. Nevertheless, the sponsors remain committed to addressing these challenges through active management and targeted interventions aimed at turning around the Company’s performance. Importantly, the sponsors’ overall financial stability and diversified investment base provide a solid foundation that supports PL’s ongoing growth and resilience. Their ability to leverage financial resources, combined with strategic oversight, positions PL well to navigate industry fluctuations and capitalize on emerging opportunities in the competitive Pharmaceutical landscape. This financial backing is crucial in sustaining long-term investments in innovation, capacity expansion, and market development, ensuring the Company remains competitive and poised for future success.

PL’s Board of Directors is comprised of ~11 distinguished members, reflecting a balanced blend of familial representation and external expertise. Among them, four seats are held by representatives from Mr. Parvez Hussain’s family, while the remaining members hail from three other prominent families. This diverse composition fosters a rich exchange of ideas, perspectives, and professional experiences, which significantly strengthens the board’s strategic oversight and decision-making capabilities. To further elevate its governance framework and align with best practices, PL may consider the voluntary adoption of the Code of Corporate Governance. This move would signal the Company’s commitment to transparency, accountability, and ethical leadership. By embracing this code, PL can enhance stakeholder confidence, improve internal controls, and ensure that its governance structures are robust, responsive, and future-ready.

PL’s Board of Directors is led by Mr. Muhammad Rasheed Khan, an esteemed veteran of the banking industry with an impressive career spanning over seven decades. His longstanding association with PL—now exceeding ~30 years—has been instrumental in shaping the Company’s strategic direction and fostering a culture of integrity and resilience. His wealth of experience and steady leadership continue to be a cornerstone of PL’s governance framework. Among the board’s distinguished members is Mr. Shamim Ahmed, a highly respected entrepreneur with substantial investments in the Pharmaceutical sector. His business acumen and industry insights bring valuable perspective to the boardroom, particularly in navigating market dynamics and identifying growth opportunities. The executive leadership includes Mr. Parvez Hussain Sufi, the Chief Executive Officer, and his son Mr. Usman, both of whom play active roles in steering the Company’s operations and long-term strategy. The remaining board members serve in non-executive capacities, ensuring a balanced governance structure that promotes independent oversight and accountability. Each board member is a seasoned professional with deep-rooted experience in the Pharmaceutical industry. Their collective expertise supports robust governance, informed decision-making, and strategic foresight—key pillars that drive PL’s continued success and commitment to excellence.

PL’s Board of Directors has taken a proactive step in strengthening its governance framework by establishing an Audit Committee composed of three members. This committee plays a critical role in overseeing the Company’s financial reporting, internal controls, and compliance with applicable professional and regulatory standards. Its presence reflects PL’s commitment to maintaining transparency, accountability, and ethical financial practices. However, beyond the Audit Committee, the Company currently does not maintain any other board-level committees. This presents a valuable opportunity for the sponsors and leadership to further enhance PL’s corporate governance by considering the formation of additional specialized committees. Establishing such committees would not only broaden the scope of board oversight but also promote more focused and informed decision-making across key areas of the business. It would align PL more closely with global best practices and reinforce its reputation as a forward-thinking, well-governed enterprise.

The Company's External Auditors, Kreston Hyder Bhumji & Co. Chartered Accountants (QCR-rated & belongs to category A of SBP) expressed an unqualified opinion on the financial statements for the year ended June 30, 2025.

PL has established a robust and clearly defined organizational structure, segmented into eight specialized functional departments. Each department is led by experienced professionals who bring deep domain expertise and a commitment to operational excellence. This well-structured organizational framework enables PL to operate with precision and agility. By clearly delineating responsibilities and fostering cross-functional collaboration, the Company is well-positioned to achieve sustainable growth, drive innovation, and respond effectively to evolving market demands. The departments include: 1) Quality Assurance – Ensures that all products meet stringent quality standards and regulatory requirements, safeguarding consumer trust and product integrity. 2) Operations – Manages day-to-day manufacturing and logistical activities, optimizing resource utilization and ensuring timely delivery. 3) Technical – Oversees product development, process engineering, and technical innovation, driving continuous improvement and efficiency. 4) Marketing & Sales – Develops strategic market positioning, customer engagement, and revenue generation initiatives to expand PL’s market footprint. 5) Finance – Handles financial planning, budgeting, and reporting, ensuring fiscal discipline and supporting strategic investments. 6) Information Systems – Maintains and enhances the Company’s digital infrastructure, enabling data-driven decision-making and operational agility. 7) Human Resources & Administration – Manages talent acquisition, employee development, and organizational culture, fostering a productive and motivated workforce.8) Internal Audit – Provides independent oversight of internal controls and compliance, reinforcing transparency and accountability across all functios.             

Mr. Parvez Hussain Sufi has been at the helm of PL since its inception, serving as both Managing Director and Chief Executive Officer. With an illustrious career spanning nearly ~46 years, he brings a wealth of experience and strategic insight to the organization. Over the past ~28 years, Mr. Pervez has successfully led and managed a range of industrial ventures, with a particular emphasis on the Pharmaceutical and healthcare sectors—areas in which he has developed deep operational and regulatory expertise. A distinguished professional, Mr. Pervez is a fellow member of two prestigious institutions: the Institute of Chartered Accountants in England and Wales (ICAEW) and the Institute of Chartered Accountants of Pakistan (ICAP), both since 1976. His dual qualifications reflect a strong foundation in financial stewardship and corporate governance, which have been instrumental in shaping PL’s growth trajectory. Under his visionary leadership, PL has cultivated a high-performing management team composed of seasoned professionals, many of whom have been with the Company for decades. This continuity has fostered a culture of trust, institutional knowledge, and operational excellence—key drivers of PL’s sustained growth, resilience, and industry reputation.

PL has established a Business Development Committee, which includes company directors and heads of departments (HODs). This committee plays a key role in driving strategic growth initiatives and business expansion. To further improve the efficiency and effectiveness of operational decision-making, PL should consider forming additional management committees focused on specific functions or cross-departmental collaboration. Each department within the Company has a well-defined management hierarchy consisting of multiple levels. This structured approach ensures smooth communication, clear accountability, and streamlined operations across all areas of the business.

PL has successfully implemented a custom-built, web-based Enterprise Resource Planning (ERP) system called Vintage Pro ERP. This system is deployed across both the head office and manufacturing facilities. It was specifically designed to meet the Company’s unique operational requirements and integrates key business functions such as procurement, inventory management, production planning, sales and distribution, finance, and human resources.  By using Vintage Pro ERP at all major operational sites, PL ensures real-time, centralized access to critical data. This seamless connectivity improves communication and coordination between departments. The system significantly reduces manual processes, minimizes data silos, and enhances the accuracy and consistency of information across the organization. The ERP system has delivered several important benefits. It has enhanced operational efficiency by automating workflows and streamlining processes, resulting in faster turnaround times and increased productivity. Management now has access to real-time data and reporting, which supports more informed and timely decision-making. Additionally, the system improves inventory and supply chain management by providing better tracking of raw materials and finished goods. This helps reduce stockouts, overstocking, and waste.  Financial control has also been strengthened, as the integrated finance modules ensure accurate tracking of transactions, budgeting, and regulatory compliance. Being web-based, Vintage Pro ERP offers scalability and flexibility, allowing the system to be easily upgraded or expanded to support future business growth and changing operational needs. Overall, the implementation of Vintage Pro ERP reflects PL’s commitment to digital transformation and operational excellence. It enables the Company to respond effectively to market changes, regulatory demands, and customer expectations within the competitive pharmaceutical industry.

PL upholds a rigorous commitment to quality control, a cornerstone of its operations in the highly regulated Pharmaceutical industry. The Company’s quality assurance protocols are meticulously designed to ensure that every product meets the highest standards of reliability, safety, and efficacy. These protocols are aligned with both local regulatory frameworks and international compliance benchmarks, reflecting PL’s dedication to delivering trusted healthcare solutions and maintaining public confidence. Complementing its quality systems, PL has instituted a robust Internal Audit function that plays a pivotal role in reinforcing governance and internal controls. This function reports directly to the Audit Committee of the Board, ensuring independence and transparency in oversight. In a strategic move to enhance audit integrity and professional rigor, PL has outsourced its internal audit operations to EY Ford Rhodes Chartered Accountants, a member firm of the globally recognized Big Four accounting firms. This partnership brings world-class audit practices, impartial evaluation, and deep industry expertise to PL’s internal control environment. Together, these frameworks reflect PL’s unwavering commitment to operational excellence, regulatory compliance, and ethical business conduct—key pillars that support its long-term sustainability and reputation in the pharmaceutical sector.

The global Active Pharmaceutical Ingredients (API) market is experiencing steady growth, driven by rising demand for generic drugs, biologics, and treatments for chronic diseases. With a projected CAGR of around ~6.8%, the market is expected to surpass USD ~418bn by 2034. Key trends include increased outsourcing to CMOs, especially in India and China, and a shift toward high-potency and sterile APIs. Regulatory pressures and supply chain vulnerabilities remain challenges, while technological advancements and expanding healthcare access in emerging markets present significant opportunities for innovation and expansion. Pakistan’s Active Pharmaceutical Ingredients (API) industry is still in its early stages, with approximately ~23 local manufacturers currently operating. These domestic producers collectively fulfill only around ~15% of the national demand, leaving a significant ~85% reliant on imports. This heavy dependence on foreign sources highlights both the challenges and opportunities for growth within the local API sector, particularly in enhancing self-sufficiency and reducing supply chain vulnerabilities. DRAP is promoting local production, but the industry relies heavily on imports from China and faces foreign exchange risks. More technology partnerships and research are needed to reduce import reliance.  Usually, Pharmaceutical MNCs procure APIs and finished products from their parent or group companies. Local companies, on the other hand, rely on cost effective sources to purchase these. Pakistan’s Pharmaceutical industry is both dynamic and growing, comprising approximately ~625 companies. Of these, around ~600 are local firms, while about ~25 are multinational corporations (MNCs). The market share between local and multinational companies stands at a ratio of 75:25, favoring local players. The industry meets nearly ~80% of the country’s pharmaceutical demand through domestic production. The remaining ~20% is fulfilled through imports of finished products. However, around ~90% of the raw materials used—primarily Active Pharmaceutical Ingredients (APIs)—are imported from other countries. Market leadership is concentrated among major players, with the top ~20 Pharmaceutical Companies accounting for ~68% of the total market share. The top 50 Companies collectively hold around ~89% of the market, highlighting the dominance of large corporates in the sector. The Pharmaceutical market in Pakistan offers significant growth potential. One of the key indicators is the country's low per capita healthcare spending, which is among the lowest in the world. This suggests ample room for increased investment and consumption in the healthcare sector as economic conditions and healthcare awareness improve. Additionally, rural areas across Pakistan remain largely underserved, with limited access to medical facilities and essential medicines. Expanding healthcare services and pharmaceutical distribution in these regions represents a major opportunity for growth within the industry.

The Active Pharmaceutical Ingredient (API) manufacturing sector in Pakistan remains relatively underdeveloped, with limited infrastructure and investment in local production. As a result, many Pharmaceutical Companies have shifted their focus toward importing and trading APIs rather than producing them domestically. This reliance on foreign sources not only increases costs but also exposes the industry to supply chain disruptions and regulatory complexities. In this context, PL stands out as one of the few companies actively engaged in domestic API manufacturing. Its commitment to local production gives it a distinct competitive edge in a market where most players depend heavily on imports. By investing in API manufacturing capabilities, PL is not only reducing dependency on external suppliers but also contributing to national healthcare resilience. This strategic positioning places PL in a strong trajectory for sustained growth and market leadership. As demand for locally produced APIs continues to rise—driven by cost efficiency, supply chain reliability, and evolving regulatory preferences—PL is well-equipped to capture a larger share of the market. Its ability to offer high-quality, locally manufactured APIs aligns with both industry needs and national priorities, reinforcing its role as a key player in Pakistan’s Pharmaceutical ecosystem.

In FY25, Pharmagen delivered a modest revenue growth of  ~6.2%, slightly ahead of the ~5.5% recorded in FY24. Total revenue rose to PKR ~16,380mln, up from PKR 15,421mln in the previous year, with the topline improvement primarily driven by higher sales volumes. However, overall growth remained contained as a decline in global API prices led to a corresponding reduction in domestic selling prices. The Company’s product portfolio remains highly concentrated, with its top five products contributing nearly ~89% of total sales. While this reflects the strength and market demand for PL’s core offerings, it also underscores the importance of diversification to reduce exposure to product-specific risks and enhance long-term stability. Looking ahead, PL is well-positioned for accelerated growth, supported by the annual capacity expansion of its Paracetamol project by ~3,600 metric tons. This initiative is expected to boost production volumes and extend market reach, paving the way for stronger revenue performance in the coming years.

In FY25, PL maintained a stable gross margin of ~7.0%, slightly down from ~7.2% in FY24. This marginal decline reflects the impact of pricing pressures, yet underscores the Company’s ability to manage input costs effectively. Similarly, the operating margin held steady at around ~4.3%, compared to ~4.7% in the previous year, indicating disciplined operational control despite rising expenses. The net profit margin also remained relatively stable, settling at ~1.5%, down modestly from ~1.8% in FY24. This performance highlights PL’s effective cost management and operational efficiency, even in the face of external challenges such as inflationary pressures and competitive pricing dynamics.

PL’s earnings outlook is poised for improvement, supported by the stabilization of the exchange rate and ongoing capacity enhancements across key production facilities. The expansion of the Penicillin, Cephalosporin, and Multi-purpose plants has significantly bolstered the Company’s ability to meet rising market demand while improving operational efficiency. Additionally, the Paracetamol plant expansion has played a pivotal role in diversifying PL’s revenue streams, contributing positively to overall sales growth and reducing reliance on a concentrated product mix. To further reinforce financial performance and strategic planning, it is essential to implement a structured monthly and quarterly performance review mechanism. This should be complemented by the development of robust and prudent financial projections, enabling more accurate forecasting, disciplined budgeting, and informed decision-making. Together, these measures will enhance PL’s financial agility and position the Company for sustained profitability and long-term growth.

PL manages its working capital requirements through a combination of internal cash generation and short-term borrowings. In FY25, short-term borrowings declined significantly to PKR ~148mln, down from PKR ~934mln in FY24, indicating reduced reliance on external funding. The Company also improved its operational efficiency, as net working capital days dropped to around ~37 days in FY25 from ~60 days in the previous year. This improvement was primarily driven by a reduction in inventory holding days. Despite the decline in short-term borrowings, PL retains sufficient borrowing capacity for working capital needs, as reflected in its short-term trade leverage, which stood at a manageable ~38% in FY25 (FY24: ~42%).

The Company reported free cash flow from operations (FCFO) of PKR ~283mln in FY25, compared to PKR ~542mln in FY24. This decline reflects a reduction in operational cash generation during the period. Despite this, the Company’s interest coverage ratio remained positive, though it moderated to ~1.3x in FY25 from ~1.9x in FY24, indicating a reduced but still adequate ability to meet interest obligations from operating profits.

As of FY25, the Company's debt portfolio remains predominantly composed of short-term borrowings, representing  ~99% of total debt (FY24: ~98%). This reflects a consistent approach to managing liquidity through short-term financing instruments. Despite the concentration in short-term debt, PL continues to uphold a conservatively leveraged capital structure. The Company's leverage ratio—defined as total debt relative to equity—declined significantly to ~6% in FY25, compared to ~20% in FY24. This reduction underscores PL’s commitment to financial discipline and balance sheet strength, positioning the Company for sustainable growth and resilience against market volatility.