PACRA Maintains Entity Ratings of Pharmagen Limited

The assigned ratings of Pharmagen Limited (hereinafter referred to as "Pharmagen" or the "Company") reflect its established standing as a pioneer and one of the leading manufacturers of Active Pharmaceutical Ingredients (APIs) in Pakistan. Pharmagen maintains a consistent focus on the production of high-quality Pharmaceutical raw materials and on expanding its local manufacturing footprint to support Pakistan’s broader goal of Pharmaceutical self-sufficiency. The Company operates state-of-the-art, ISO-certified, and GMP-compliant facilities for the production of Penicillins, Cephalosporins, and other Multipurpose APIs, with Paracetamol API production recently added to its portfolio. Its client base includes leading Pharmaceutical Companies such as GlaxoSmithKline Pakistan Limited, Sami Pharmaceuticals (Private) Limited, and Getz Pharma (Private) Limited. The Company’s operations contribute to improving healthcare affordability, promoting indigenization, and increasing local value addition, thereby facilitating foreign exchange savings through import substitution. Pakistan currently meets only about ~15% of its Active Pharmaceutical Ingredient (API) requirements, relying predominantly on imports from China and India. The local API industry remains constrained by limited production capacity, high input costs, and technological gaps, which restrict competitiveness and scale. However, policy measures introduced by the Drug Regulatory Authority of Pakistan (DRAP), along with recent private investments and backward integration initiatives by local manufacturers, indicate a gradual shift toward enhanced self-sufficiency and modernization of the domestic API sector. Company’s top 5 products include Amoxycillin, Cephradine, Cefixime, Paracetamol and Ciprofloxacin, these contribute ~89% of total revenue. SAMI’s strategic partnership with Pharmagen Limited also serves as a significant catalyst for Pharmagen’s growth and long-term sustainability. Additionally, the Company benefits from the sponsor’s extensive industry experience and clear strategic vision, providing strong governance and a solid foundation for sustained success. In FY25, Pharmagen recorded a modest revenue growth of ~6.2%, reaching PKR ~16,380mln. The topline improvement was 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. Despite this, margins largely remained intact across all levels, reflecting effective cost management and operational efficiency. Going forward, the management aims to strengthen operational efficiency through process enhancements, cost optimization, and strategic expansion of the product portfolio. The financial profile of the Company is considered adequate, with comfortable coverages, cashflows, and working capital cycle. The capital structure is modestly leveraged, with borrowings primarily consisting of short-term loans for working capital requirements.
The ratings are contingent upon the successful execution of the proposed strategy, emphasizing the preservation of the current market position and sustained profitability in line with the Company’s growth objectives. Additionally, maintaining debt metrics within acceptable thresholds remains a critical prerequisite.

About the Entity
Pharmagen Limited, an unquoted public limited Company, has been a key player in Pakistan's Active Pharmaceutical Ingredients (APIs) sector since 1990. The Company is engaged in the manufacturing and sale of pharmaceutical products and over the years it has become the leading producer of APIs (Active Pharmaceutical Ingredients) in Pakistan. Pharmagen is primarily owned by Mr. Parvez Hussain’s family (~44%) and Mr. Shamim Ahmed’s family (~30%). Other strategic partners include Mr. Rahim Khan Trust / Kashmir Education Foundation (~15%), Mr. Rasheed Khan’s family (~7%), and others (~4%). Mr. Parvez Hussain Sufi serves as the CEO of the Company.