Saudi Arabia Wants More Medicines Made Locally: What This Means for Global Pharmaceutical Companies

Saudi Arabia, the largest pharmaceutical market in the Middle East and North Africa, is pushing to make more of its own medicines. For global drugmakers, the shift is turning market access into a question of local manufacturing, partnerships and technology transfer, not just regulatory approval. The policy is clear in direction, but several of the numbers behind it are less firm than the headlines suggest.

The size of the shift

Oliver Wyman valued the Saudi pharmaceutical market at roughly $14 billion to $16 billion in 2024, with generics holding close to 40 percent of it. Locally made drugs rose from 26.3 percent of total drug consumption in 2019 to 30.5 percent in 2024, according to the Vision 2030 Health Sector Transformation Report 2025, as cited by the consultancy. That leaves most medicines supplied from elsewhere, though Oliver Wyman did not state an import share and cautioned that the local figure does not by itself imply the rest is imported.

We did not find a verified numeric localisation target from a primary government source. One U.S. government guide to the Saudi market cited conflicting private-sector targets in different sections, so we do not repeat them here. What the sources agree on is the direction. Oliver Wyman said domestic production increasingly shapes procurement, market access and competitive position, especially in public-sector channels.

How the policy works

Much of the leverage sits in public purchasing. The state buyer, NUPCO, centrally procures pharmaceuticals and medical supplies for public facilities, according to the U.S. International Trade Administration's commercial guide. Only prequalified companies may bid, and foreign companies must register themselves with NUPCO and their products with the Saudi Food and Drug Authority. The guide said tenders are often open only briefly, which makes a local connection important, and recommended partnering with a local company. It also listed incentives, including tax rebates for regional headquarters and, in some pharmaceutical establishments, foreign ownership.

The Public Investment Fund's company Lifera is intended to build the local biopharmaceutical industry as a contract development and manufacturing organisation, according to the same guide.

What global companies have signed

Several global firms have signed agreements, mostly framed around technology transfer and local production:

• Sanofi. In October 2024, Sanofi, Saudi manufacturer Sudair Pharma and NUPCO signed an offtake agreement to localise production of Sanofi's insulin pens and related products, according to Saudi Shopper. Contract length, volumes and value were not disclosed, and full local manufacture was described as an "ultimate goal".
• Novo Nordisk. Lifera, through its subsidiary SaudiBio, and Novo Nordisk agreed in October 2024 to localise insulin production. The headline target was more than 50 percent of Saudi insulin needs. Saudi Gazette reported Saudi Arabia is expected to become the first GCC producer of a biologic innovator insulin by 2027, with more than 200 skilled jobs by 2027 or 2028. No investment figure was given. Separately, Novo and Lifera signed a memorandum of understanding on exploring local production of semaglutide treatments, without terms or timeline.
• Pfizer. Pfizer Saudi Arabia and Lifera signed a memorandum of understanding in October 2025 to explore local manufacturing, technology transfer and workforce development. Gulf News described it as an exploration, with no financial terms.

Most of these announcements come from company statements. Memoranda of understanding are not binding commitments, and none of the reports we reviewed gave investment amounts.

What it means for global drugmakers

• Access may follow manufacturing. Where public tenders favour local production, companies that do not localise may find some channels harder to reach. The sources do not detail the specific preference rules, so the exact weighting is unclear.
• Technology transfer is the price of entry for some products. The insulin deals show the Saudi side asking for biologics know-how and training, not just supply contracts.
• Partners matter. The U.S. government guide advises a local partner to navigate tenders and import rules.
• Pricing pressure. Oliver Wyman noted that constrained healthcare budgets make generics attractive, which could squeeze originator products even as demand grows. Demand drivers include a population that rose from about 16 million in 1990 to about 37 million in 2025, and about 19 percent of adults with at least one chronic condition.
• Execution risk. Building aseptic and biologics capacity takes years, and the announced timelines are targets.

What to watch

Whether memoranda become binding contracts with volumes and prices, whether the government publishes a clear localisation target and procurement rules, and whether local output keeps rising from the 30.5 percent level reported for 2024.