State Trading Organization (STO) CEO and Managing Director Shimad Ibrahim said that the establishment of a new state-owned pharmaceutical company is expected to improve STO’s profitability.
Responding to questions from shareholders at the company’s annual general meeting, Shimad said STO’s pharmaceutical segment generated MVR 1.5 billion in revenue last year. However, he noted that the restructuring could reduce revenue from the segment by around 50 percent.
Despite that decline, he said the move would significantly reduce operating costs and improve overall profits.
“There are about 750 employees in this segment. Many of these employees will join the new company. Therefore, the company will save significant costs. Therefore, profit will improve,” Shimad said.
He added that STO has operated pharmacies across Maldives since 2016, but many outlets on smaller islands have been running at a loss. Recruiting staff for pharmacies in remote islands has also been challenging, he said.
According to Shimad, the newly established State Pharmaceutical and Medical Supply Company is expected to address those issues.
He said STO would continue to handle the registration and import of medicines, including additional quality pharmaceutical products, following the restructuring.
The new company, established by President Dr Mohamed Muizzu in September last year, was created to procure, import and distribute medicines, medical consumables and medical equipment across Maldives.
