The UAE has officially launched a historic regulatory shift to end long-standing monopolies in the pharmaceutical sector. By establishing a new mechanism that requires drugmakers to appoint multiple authorized agents for every medical product, the Emirates Drug Establishment (EDE) is dismantling the ‘single-agent’ model that has controlled the market for decades.
This change will help address medicine shortages. It will also create fair competition and help people across the country get life-saving pills more easily.
For a long time, only a single local company could sell a specific medicine in the UAE. This caused problems if that one company had a delivery delay. If they had trouble, the medicine would simply disappear from pharmacy shelves. New rules under Federal Decree-Law No. 38 of 2024 have changed this system.
Now, drug companies must have at least two importers and one or more distributors. This means no single company can control the supply or the timing of medicine deliveries.
According to Emirates News Agency WAM, Saeed bin Mubarak Al Hajeri, Minister of State and Chairman of the EDE, explained why this is important: "The mechanism is part of the UAE's public policy approach to developing a national pharmaceutical ecosystem capable of keeping pace with evolving health and economic developments.
He also stated that, “EDE is committed to strengthening the diversification of supply chains, enhancing regulatory efficiency, and establishing a flexible legislative environment."
Medicine prices are currently set based on fixed profit margins. These are usually 15% to 20% for agents and 18% to 24% for pharmacies. There was no reason for companies to lower their prices in the previous system.
In the next six months, having multiple agents will likely start a ‘price war’ between wholesalers. These agents will compete to sell to big pharmacy chains and might offer better deals or lower rates to win more business deals. This competition matches the Federal National Council's (FNC) goals to make medicine for chronic diseases cheaper.
Overall, the move toward a multi-agent system is a huge step for the UAE's $1.1 billion drug market. During the next year, more foreign companies will likely export their medicines to the country without having to worry about being stuck with only one local partner.