ABSTRACT

For decades, Pakistan has experienced an increasingly burdensome regulatory environment, transforming the economy into a “permission economy” marked by excessive and inefficient regulations. This regulatory burden has had detrimental effects on various economic activities, like investment, and overall GDP growth. The prevailing regulatory regime in Pakistan represents a classic case of regulatory failure, as the government attempts to address this issue by implementing more regulations without thoroughly evaluating the underlying causes. Consequently, various regulatory bodies have emerged, often with overlapping functions, thereby exacerbating the regulatory burden on different sectors of the economy. This study aims to explore the specific regulatory burden faced by the pharmacy segment within the pharmaceutical sector of Pakistan. Its primary objective is to measure the costs associated with regulation that individual entities operating within the healthcare sector bear. These costs include the expenses related to learning and understanding regulatory requirements, compliance efforts, as well as the psychological impact of navigating the complex regulatory landscape when establishing and operating a pharmacy. Furthermore, the study seeks to examine the implications of this regulatory burden on GDP growth. To achieve these objectives, the study relies on primary data collected from the Islamabad Capital Territory (ICT), providing a focused and localized perspective on the regulatory burden within the pharmacy segment. The findings of this study will contribute to the existing body of knowledge on the regulatory burden and its implications for the pharmacy segment in the pharmaceutical sector of Pakistan. By quantifying the costs associated with regulation and exploring its impact on GDP growth, policymakers and regulatory authorities can gain valuable insights to inform evidence-based decision-making. Furthermore, the study may provide recommendations for streamlining and rationalizing the regulatory framework, thereby fostering a more conducive environment for pharmacy businesses and promoting sustainable economic growth in the pharmaceutical sector of Pakistan.