Pakistan's listed pharmaceutical companies earned a record Rs 42.2 billion in profit in fiscal year 2026 (July 2025 to June 2026). That is 28% higher than last year. It is the highest annual profit the sector has ever posted. The jump came mostly from higher medicine prices and lower borrowing costs, according to Topline Securities.
Why Profit Jumped
Two things drove the record profit. First, medicine prices rose through the year, pushing up companies' margins. Second, finance costs fell sharply as interest rates eased.
The sector's gross margin hit 42.8%, the highest on record. That is up from 38.9% a year earlier. Finance costs fell 42% to Rs 3.6 billion, down from the previous year.
Net sales also grew. They rose 10% to Rs 377.9 billion, up from Rs 342.6 billion in FY25. Most of that growth came from higher prices, not more medicine sold.
| Metric | FY26 | Change |
|---|---|---|
| Profit | Rs42.2 billion | +28% |
| Gross margin | 42.8% | up from 38.9% |
| Net sales | Rs377.9 billion | +10% (from Rs342.6 billion) |
| Finance costs | Rs3.6 billion | -42% |
| Selling and distribution costs | Rs69.5 billion | +21% |
| Effective tax rate | 42.5% | up from 39.8% |
Profit has grown steadily for years. Since FY17, it has risen by about 14% a year, on average, over nine years.
The Flip Side
Profit grew 28%. But the sector's combined stock market value rose only 2% over the year, as of June 30, 2026. Investors did not reward the profit jump the same way.
One company explains part of the gap. The Searle Company posted a loss in the fourth quarter. That pulled down the sector's total earnings for the quarter. Without Searle, sector profit for the full year grew 22%, not 28%.
Excluding Searle and Liven Pharma, the sector's market value rose just 0.4% for the year.
