Pharmaceuticals and Healthcare in Kazakhstan

Pharmaceuticals and Healthcare in Kazakhstan

Introduction to the Industry

Kazakhstan’s pharmaceutical and healthcare sectors are undergoing significant transformation, driven by:

  • Government modernization programs (e.g. “Healthy Nation” strategy until 2025)
  • Rapid growth in public-private partnerships (PPPs)
  • Expansion of local pharmaceutical manufacturing
  • Growing interest from foreign pharmaceutical companies and medical device suppliers

The government aims to increase local pharmaceutical production from 17% to 50% by 2025, creating strong incentives and legal reforms to attract foreign investment.

Market Overview

➤ Healthcare Sector:

  • Universal healthcare system under Mandatory Social Health Insurance Fund (MSHIF)
  • Significant public procurement of medicines, equipment, and digital solutions
  • Demand for private clinics, diagnostic centers, telemedicine, and wellness services is growing

➤ Pharmaceutical Sector:

  • Estimated market size: USD 1.5 billion (2024)
  • Fastest-growing segments:
    • Generic drugs
    • Biopharmaceuticals
    • Nutraceuticals and dietary supplements
  • Key players: SANTO, Nobel AFF, Abdi Ibrahim, Kyzyl May
  • Strong reliance on imports (70%), especially for high-value medicines

Regulatory Landscape

Key Regulatory Bodies:

  • Ministry of Health of the Republic of Kazakhstan
  • Committee for Medical and Pharmaceutical Control
  • SK-Pharmacy LLP (state-owned monopoly on public medicine procurement)
  • Kazakhstan National Center of Expertise of Medicines

Major Laws & Regulations:

  • Code “On Public Health and Healthcare System” (2020)
  • Law “On Licensing and Notifications” (2021)
  • EAEU Technical Regulations (as Kazakhstan is part of the Eurasian Economic Union)
  • Rules on GMP/GDP Certification, drug registration, labeling, pricing, and import/export

Licensing:

  • Manufacturing, import, retail, and distribution of medicines require mandatory licenses
  • Licensing periods: typically 10 years, with compliance inspections every 2–3 years

Clinical Trials:

  • Permitted under strict guidelines via accredited institutions and ethical committees
  • Requires registration with the Unified State Register of Clinical Trials

Foreign Investment & Legal Protections

Kazakhstan offers a liberal investment climate with international protections:

Key Protections:

  • Bilateral Investment Treaties (BITs) with >50 countries
  • Membership in ICSID & New York Convention
  • Investor Dispute Resolution via AIFC Court & IAC (Astana International Financial Centre)

Tax & Customs Preferences:

  • Tax holidays in Special Economic Zones (SEZs)
  • Investment subsidies, customs duty exemptions
  • Priority status for foreign investors in pharma infrastructure projects

Intellectual Property Protection:

  • Patent protection for pharmaceutical products (20 years)
  • Brand/trademark registration through Kazpatent or Madrid Protocol
  • Strong legal tools to combat counterfeiting and parallel imports

Public Procurement in Pharmaceuticals

  • Centralized procurement via SK-Pharmacy LLP for hospitals and clinics
  • Requires:
    • Product registration in Kazakhstan
    • Pricing submission and approval
    • Tender or long-term supply agreements (up to 10 years)

Foreign pharmaceutical companies may participate through:

  • Kazakhstan-registered subsidiaries
  • Local distributors
  • Contract manufacturing partnerships

Challenges & Compliance Risks

  • Complex and evolving drug registration and certification procedures
  • Local content requirements in procurement
  • Delays in GMP inspections and EAEU harmonization
  • Stringent rules on advertising, pharma reps, and digital marketing
  • Risk of tax audits for foreign entities operating through distribution schemes

How Bond Stone Law Firm Can Help

Legal Services for the Pharma & Healthcare Sector:

Service Area Our Expertise
Regulatory Licensing Licensing for manufacturers, distributors, and clinics
Clinical Trial Approvals Full cycle legal support for study protocols, ethics reviews, regulatory filings
Market Entry & M&A Structuring joint ventures, distributor agreements, equity deals
GMP/GDP Compliance Legal consulting for inspections, documentation, appeals
Public Procurement Support SK-Pharmacy bidding strategies, contract drafting, dispute resolution
Contract Manufacturing & OEM Legal structuring for toll manufacturing, contract R&D, co-branding
IP Protection & Anti-Counterfeiting Registration of trademarks, patents, and legal enforcement
International Arbitration Investor-state disputes at AIFC or international tribunals

Why Choose Bond Stone?

  • Multilingual team (Kazakh, Russian, English, Turkish)
  • Deep expertise in regulatory law, cross-border M&A, and intellectual property
  • Offices in Astana, Almaty, Tashkent, and Bishkek with regional reach
  • Recognized advisors to pharma startups, multinational drug firms, and medical device companies