The UAE has been found to have the best developed ecosystem for producing Halal pharmaceuticals, in terms of supply drivers, governance, awareness and pricing index, according to the most recent State of Global Islamic Economy report.
The UAE was followed by Malaysia and Singapore.
The report stated that Muslims have been spending at least Dh286 billion ($78 billion) a year on Halal pharmaceuticals. Mapping consumer spending, it found that the top five Muslim pharmaceutical markets are Turkey, Saudi Arabia, the US, Indonesia, and Algeria, with a total value of Dh112.7 billion ($30.7 billion).
This multibillion-dollar Halal pharmaceutical industry is expected to expand even further as the UAE-based International Halal Accreditation Forum (IHAF) initiates global standardisation efforts.
“As consumer awareness gets stronger, the market demand for Halal pharmaceutical products continues to grow through the years. But for the longest time, no single entity with a comprehensive international presence had addressed the Sharia compliance needs of this segment. IHAF is committed in addressing these concerns with the support of various accreditation agencies across the globe,” Mohammed Saleh Badri, secretary general of IHAF, said.
“Halal pharmaceuticals would particularly benefit from IHAF’s efforts that aim to assist in developing those unified global standards to fill a huge gap in the market,” Badri said.
According to the report, market growth opportunities are particularly seen in the manufacturing sector. However, a lack of strong and internationally recognised standardisation scheme has become a barrier in the mass production of goods.
“Mass manufacturing would be made possible by standardisation, which would aid economies of scale and barrier-free global trade,” Badri said.
“Standardisation means that manufacturers have a clear picture of what the product is and how they should produce it, guaranteeing that the product would be accepted everywhere. Otherwise, manufacturing specific products for specific groups of consumers is expensive. Unified standards would remove any uncertainties for global trade,” Badri added.
“Standardisation is also expected to increase investor interest. Based on latest studies, one of the major issues for Halal pharmaceuticals and cosmetics was inadequate funding. Investor interest had been limited so far because the business itself was on a limited scale. Now the business is growing, therefore, the supply-and-demand equation would draw more funding, helping Halal commodities compete with non-Halal products in the same category,” Badri said.
Alongside creating unified global standards, IHAF will promote awareness on the scientific foundation and health benefits of Halal products.
“Raising awareness amongst these consumers will make them choose authentic, certified Halal products, and that would further increase demand. One of IHAF’s main objectives is to ensure unified standards, integrity and transparency within the Halal accreditation scheme,” Badri added.
In pharmaceuticals, the IHAF standardisation exercise will first focus on vaccines, and common medicines for cough, fever, and headaches. Creating standards for life-saving medicines would be taken up later.
“Within our three-year strategic goals, which are being developed, we should have food, pharmaceutical and cosmetics within the ambit of unified standards and product verification schemes. The system of Sharia-compliant standards would be similar to that for Halal food. We expect manufacturers and certification bodies to treat cosmetics the same way they treat food,” Badri concluded.