ASSESSMENT OF FACTORS AFFECTING VERTICAL GROWTH OF LOCAL PHARMACUITICAL MANUFACTURING IN ADDIS ABABA.

Abstract

The pharmaceutical industry in Ethiopia like in the rest of the world is experiencing the same phenomenon that many other industries have faced in the past. Many companies have been forced to try and reinvent themselves in the face of challenges in their business environment which has had effect on their growth. The objective of the study to assess the factors related to local pharmaceutical manufacturing companies and their influence on vertical growth of this sector in Ethiopia. The study adopted descriptive cross sectional research design and targeted 53 employees and 10 key informant interviews from 3 local registered pharmaceutical manufacturing firms in kiliinto industrial park Addis Ababa Ethiopia. Data was collected using a questionnaire and analyzed using descriptive statistics as well interviews were analyzed using thematic analysis to look at the factors influencing the pharmaceutical manufacturing. The study found that there has been increase in the number of employees in the firms since their start of the firm 10-15 to 50 or more number of employees signifying growth. Government regulations also favored growth of the firms. This could be attributed to government policies aimed at enhancing growth in the sector. The study concludes that the international regulations have benefited the local firms even though they seem to favor multinationals. Further, the study concludes that the cost of production in Ethiopia, largely driven by cost of imported raw materials, and machinery had a significant negative influence on the growth of these firms. The study recommends the government should fully implement the launched National Strategy and Plan of Action for Pharmaceutical Manufacturing Development in policies and regulations that encourage the growth of pharmaceutical manufacturing in Ethiopia