Drug production in Poland: A government strategy and a proxy are needed

The report "Macroeconomic Impact of the Pharmaceutical Sector on the Polish Economy," prepared by the Institute for Innovation and Responsible Development INNOWO - THINK to DO TANK working in the area of supporting the development of innovation on behalf of the National Pharmaceutical Manufacturers, indicates the significant contribution of the industry to our economy. However, the volume share of domestic manufacturers' drugs in the Polish market has increased only slightly, while the value share of our market has declined. Meanwhile, between 2003 and 2024, there was a more than 6-fold nominal increase in the value of pharmaceutical imports expressed in euros.

Crisis-proof sector

The impact of the domestic pharmaceutical industry on the Polish economy refers to both direct impact, but also indirect and induced impact. In 2023, the total impact amounted to more than PLN 25.8 billion, which translates into 0.75% of the country's GDP, while the impact on the public sector in the form of taxes and contributions was estimated at PLN 5 billion in 2023.

The pharmaceutical sector's contribution to the Polish economy in 2023 was slightly higher than in 2019-2021, when it was in the range of 0.73-0.74% of GDP, but definitely higher than in 2022, when it was 0.67%. Such a low ratio recorded in that year was mainly due to an increase in the sector's costs, i.e. indirect consumption, as a result of, among other things, Russia's attack on Ukraine, rather than a decline in output, which remained relatively constant in relation to GDP.

In 2023, the dynamics of production costs stabilized, which translated into an increase in the sector's added value.

The report's authors assess the pharmaceutical sector's long-term contribution to GDP as relatively constant, indicating growth in the industry comparable to that for the economy as a whole.

The pharmaceutical sector in Poland is a highly productive part of the economy. Although it accounts for only 1.0% of total employment in Polish manufacturing, it produced more than 368,000 zlotys of gross value added per working person in 2023, which was about 180% of the average value of this indicator for manufacturing.

Employment is growing

The authors of the report also point out that the number of employees in the domestic pharmaceutical industry is increasing. Between 2015 and 2024, the number of employees increased by a total of 17%. The average employment in the pharmaceutical sector in 2024 was 26,900 people.

For years, the pharmaceutical sector has been at the forefront of Polish industry departments in terms of wage levels. According to data from the Central Statistical Office, in 2024 the average monthly salary in this department was PLN 10.4 thousand gross, equivalent to 127% of the average monthly salary in manufacturing. The total impact of the pharmaceutical sector on employment in the Polish economy in 2023 was 83.6 thousand full-time jobs.

Innovative industry

The pharmaceutical sector is one of the most innovative industries in the Polish economy.

In 2020-2022, the percentage of innovation-active companies was 72.2%, the highest among all divisions of the PKD. Also, the share of companies that completed or conducted innovation work was significantly higher than in total industry.

Similarly, the sector led the way in conducting research and R&D internally and outsourced to others, far surpassing the rates of industry as a whole. R&D expenditures as a proportion of total innovation expenditures amounted to 80.8%, much higher than the industry average.

Production is growing, but market share is not

The sector's global output is estimated at 21.4 billion in 2024. As of 2019, it had increased by 45.2%, or an average of 7.7% year-on-year. However, the volume share of domestic companies' drugs in the Polish market increased slightly. In 2025, it was about 50% compared to 48.6% in 2021. In contrast, the value share of our market fell to about 33% in 2025 from 35.3% in 2021. This was likely due to continued downward pressure on the prices of reimbursed drugs in Poland. According to 2024 data, generic drug prices in Poland are about 35% lower than the European average. - Although one out of every two reimbursed drugs was produced by domestic manufacturers, the share of domestic companies in the value of our market is only 30%. The share in the value of the OTC drug market is not high either, at 14%. Meanwhile, the profitability of the industry translates into investment activity, explains Krzysztof Kopeć.

Exports are on the rise

Over the past two decades, there has been a dynamic development of pharmaceutical exports from Poland. As recently as 2003, the size of the trade deficit in the turnover of pharmaceutical industry products in relation to the value of their imports was as high as 91%, last year it decreased significantly to 51%. Poland's most important trading partner in the area of turnover of pharmaceutical industry products, both as a supplier of imported goods and as a recipient of exported products, is Germany.

Among Poland's major export partners was Hungary, recording a twofold increase in export value relative to 2023. Two decades ago, Russia's share of pharmaceutical exports was as high as 23.8%, but changes brought about by Russian aggression against Ukraine and the resulting trade sanctions are forcing the search for alternative customers for exported products.

Next on the export market is Italy, with a share of 5%, as well as the Czech Republic and France, where Poland has been dynamically increasing its share over the past 3 years.

In terms of imports, Poland's second largest partner after Germany is the US, which is a relatively new situation. While the share of imports from the US as recently as 2019 was only 3.3%, by 2024 it had reached 12.5%. Given that the surge in imports from the US occurred in 2020, it may be related to the supply of COVID-19 vaccines.

Another important importer is Italy, which is strengthening its position on the Polish market, and South Korea, which as recently as 2023 was an insignificant partner with an import share of 1.8%, but has now reached 7.1%, ranking in the same place as France. While as recently as 2003 the share of imports from France was 17.1% and equal to that of Germany, by 2024 its value had shrunk to 7.1%. The UK is also a country that has lost its position on the Polish market. Its share of imports has fallen from 13.1% in 2010 to 2.4% today.

Importance of the sector

Although the pharmaceutical sector is a vital component of the Polish economy, its importance goes beyond mere economic activity. - It directly contributes to improving the health of Poles, which in turn increases their quality of life and the well-being of society as a whole. The development of this sector also reduces Poland's dependence on foreign drug markets. This improves Poles' security and the country's strategic resilience, which is crucial in today's times. In addition, the pharmaceutical industry is a driver of technological progress in Poland. Many indicators such as the percentage of companies introducing innovations and actively conducting research on them place it among the most innovative branches of Polish industry," Krzysztof Kopeć enumerates. He adds that in order to increase the share of domestic drugs in the Polish market, a government strategy for the development of the industry and a government plenipotentiary overseeing its implementation are needed. - To date, efforts to build Poland's drug safety resilience are scattered among various institutions, including the Ministry of Health, the Ministry of Development, the Ministry of Funds, and the Ministry of Defense. There is a lack of a center responsible for coordinating and monitoring the overall drug policy, especially in the national security dimension, he points out.

Source: PZPPF