For decades, Lebanon’s medicine supply has been trapped between the high cost of imports and the steep hurdles facing its small-scale pharmaceutical industry. The country’s financial collapse has exposed those weaknesses, sharply curbing imports and giving local manufacturers a bigger role, yet raising an uncomfortable question: how can a drug “Made in Lebanon” sometimes cost more than its foreign equivalent?

Today, about 12 licensed pharmaceutical groups operate in Lebanon, three of which meet the country’s entire need for intravenous solutions, while the rest produce dozens of therapeutic products.

Despite its long history, domestic production met only a fraction of local demand for decades. In 2019, the pharmaceutical market was worth around $1.3 billion, yet just 7% of that total came from Lebanese factories, with 93% spent on imported drugs from well-known international brands. That year, authorities set a target to lift the local share to 50% within five years through incentives and legislative support.

But the financial meltdown at the end of 2019 upended the market. A collapsing pound and a shortage of U.S. dollars disrupted imports, triggering pharmacy shortages and a thriving black market. Local manufacturers became the first line of defense, stepping in to fill much of the gap left by shrinking imports.

By 2023, domestic industry’s share had surged to about 40% of the market’s total value, with roughly 70% of drugs on pharmacy shelves manufactured locally. While this expansion was driven by emergency conditions, it raised questions over whether factories could sustain adequate supply, quality and competitive prices in the long term.

Authorities promoted local production through a “Support Lebanese Medicine” campaign and the adoption of a unified prescription form that allowed pharmacists to substitute brand-name drugs with proven generics. In 2021–2022, insurers were required to reimburse based on the price of the Lebanese product, while subsidies were maintained for domestically made medicines but lifted for imported drugs with local equivalents.

These measures made Lebanese drugs more competitive, but their continuation depends on manufacturers’ ability to keep costs under control and meet demand. 

In principle, a locally produced generic should always be cheaper than its imported equivalent, whether that import is a brand-name or a generic. By law, imported generics must be at least 10% cheaper than the brand-name, and Lebanese generics should not exceed the imported generic’s price.

Al-Modon cited data from the Manufacturers’ Syndicate and the Health Ministry generally confirming that local drugs are on average 60% cheaper than the brand-name and 20% cheaper than the foreign generic. For example, imported Jardiance sells for 3,099,000 Lebanese pounds, while its local alternative costs 1,476,000 pounds; imported Amlor sells for 159,000 pounds versus 50,000 pounds for Lebanese-made Amlene.

But the turmoil of the crisis has sometimes reversed this rule. Since 2021, when subsidies were lifted and the currency collapsed, some local generics have ended up pricier than imported originals. Local Triptyzol sells for $5 in Lebanon compared to $2.50 in Dubai, and local Fluanxol for 180,000 pounds versus 90,000 pounds for the imported version.

Experts say this is partly due to old imported stock purchased at subsidized rates, rising domestic production costs and weaker pricing oversight. According to the Pharmacists’ Syndicate, Lebanese drugs remain on average 25–30% cheaper than foreign equivalents, assuming quality is maintained. The union calls for repricing and tighter monitoring to close loopholes and prevent exploitation, while keeping local products favored when they are both affordable and effective.

Al-Modon sought comment from the Health Ministry, but it said the “issue is old” and that new staff needed time to review the file.

Three main factors explain why some Lebanese-made drugs end up more expensive than imports:

1. Production Costs – All active ingredients and packaging are imported in hard currency, with no subsidies since the pound’s collapse, pushing up selling prices.

2. Small Market and Lack of Economies of Scale – Lebanon’s limited market raises per-unit costs, forcing producers to price close to imported generics to remain profitable.

3. Subsidy and Oversight Disruptions (2019–2022) – The abrupt removal of subsidies sent import prices soaring and left supply gaps before local factories could scale up. Weak oversight allowed hoarding, price manipulation and monopolistic practices that kept some prices high.

Psychological factors have also shaped the market: before the crisis, many consumers preferred foreign drugs, believing them superior, which kept local demand — and production volumes — low. Import shortages during the crisis forced patients to try Lebanese drugs, often finding them effective, potentially paving the way for cost reductions as demand rises. But monopolies, whether through exclusive import agents or single domestic producers, have helped keep prices elevated.

Ultimately, the price gap between local and imported drugs stems from raw material costs in hard currency, market inefficiencies, weak competition and regulatory gaps. While domestic producers have offered cheaper alternatives during the crisis, some local drugs have paradoxically been more expensive.

Industry experts say the solution lies in subsidizing raw material imports, transparently capping profit margins, boosting competition and building public confidence in Lebanese drug quality. Done right, the sector could cut the import bill, secure the country’s medicine supply and turn the crisis into a chance to create a fairer, more efficient and more sustainable pharmaceutical industry.