Import Pathway versus Local Production Pathway for Medical Devices in Iran

1. Key takeaways

Iran provides two market-entry pathways for medical devices: the import pathway, in which an Iranian import company holds the licence and completes import registration on behalf of the foreign manufacturer, and the local production pathway, in which the company obtains a production licence, known in Persian as the parvaneh-e sakht. The judgment of GRZAN is that for the overwhelming majority of Chinese manufacturers the import pathway remains the first choice; however, when the product faces an Iranian-made equivalent, when import registration is blocked, or when the company plans to pursue the localisation and export orientation encouraged by clause A of Article 72 of the Seventh National Development Plan, the value of the local production pathway rises markedly. The selection criterion should be whether the product will be blocked at the import registration stage, not a simple comparison of headline costs.

• Under the import pathway, registration and the Iranian registration certificate (IRC) sit with the Iranian import company, so the manufacturer’s exposure is contractual rather than corporate.
• Under the local production pathway, the company must bind itself deeply to an Iranian production entity and accept the governance burden that comes with it.
• Article 1 of the 2019 law on supporting Iranian goods (24 articles in total) blocks import registration when similar goods, equipment and materials exist domestically, and requires at least 51% of project costs to be directed to Iranian labor, materials and services.
• Clause A of Article 72 of the Seventh Development Plan, in force for Iranian years 1403–1407, targets self-sufficiency in active pharmaceutical ingredients, drugs, consumables and medical devices; clause B covers regional mutual recognition and joint production quality certificates.
• Licensing for locally produced Class A and Class B devices is processed through a fully electronic channel, which shortens administrative turnaround.
• The decisive variable in choosing between the two pathways is import-registration blocking risk, not the lowest quoted cost.

2. Legal basis

The first instrument is the Directive on the Issuance and Renewal of Production Licences for Medical Equipment and Supplies. Under this directive, the application, tracking and certification process for Class A and Class B production licences is conducted fully electronically. This description is drawn from the public page of the Deputy for Food and Drug Affairs of an Iranian University of Medical Sciences; no official document number has been seen in public channels, and this is a practical estimate.

The second instrument is the Law on Maximum Utilization of the Country’s Production and Services Capacities in Support of Iranian Goods, adopted in Iranian year 1398 (2019) and consisting of 24 articles. Under Article 1, when similar goods, equipment and materials exist within the country, the Ministry of Industry, Mine and Trade will not process import registration for the corresponding items. Projects covered by the law must direct at least 51% of their costs to Iranian labor, materials and services.

The third instrument is the Seventh National Development Plan Law of the Islamic Republic of Iran, in force for Iranian years 1403–1407. Within Chapter 14, clause A of Article 72 addresses raising self-sufficiency in active pharmaceutical ingredients, drugs, consumables and medical devices, while clause B addresses regional mutual recognition and joint production quality certificates.

3. Expert insights

Insight 1: the two pathways place responsibility with fundamentally different entities. Under the import pathway, registration and the IRC belong to the Iranian import company, which makes the relationship between the manufacturer and the licence holder a principal–agent relationship governed by contract. Under the local production pathway, the company must bind itself deeply to an Iranian production entity, which makes the relationship a joint-venture–shared-responsibility relationship. The difference in corporate governance cost between the two models is substantial, and it should be priced into the project plan before either route is chosen.

Insight 2: local production does not bypass standards compliance. Some companies mistakenly assume that manufacturing inside Iran relaxes the standards threshold. In reality, ISIRI mandatory standards apply equally to locally produced devices, and the 51% localization cost requirement of Article 1 changes the cost structure significantly. A local production option therefore inherits both the full compliance burden and an additional cost constraint, which is why the decision must rest on blocking risk rather than on the assumption that domestic production is automatically easier.

Insight 3: clause B of Article 72 opens a new door for joint production. The plan law requires the state to push regional countries to accept Iranian-issued registration certificates, market access permits and joint production quality certificates. This means Iran is building institutional tools for the model of producing in Iran and exporting to the region. For companies with regional ambitions, the strategic value of the local production pathway is higher than its short-term cost, because the certificate structure is being designed to travel across borders.

4. Practical recommendations

• Run a blocking test first: before project initiation, check for Iranian-made equivalents and judge whether import registration can pass; where blocking risk is high, prioritise evaluating the local production option.
• Build the localization ratio into the cost model: the cost model for any local production option must include the 51% localization cost constraint, not treat it as an afterthought.
• Export-oriented companies should prioritise local production: where the target market includes neighboring countries, the joint production quality certificate route can be used to serve the region from an Iranian base.
• Prefer the electronic channel for Class A/B: licensing for locally produced Class A and Class B devices is already electronic, which can compress administrative round-trip time when the project timeline is tight.

5. Verification checklist

• □ Domestic equivalent comparison has been completed and the import registration blocking risk level is defined
• □ A cost–timeline–responsibility comparison table covering both pathways has been established
• □ The 51% localization cost constraint has been included in the local production option
• □ The availability of the joint production quality certificate for regional exports has been assessed
• □ Full electronic processing has been confirmed as available for the Class A/B licensing channel

How GRZAN can help. GRZAN provides medical device and IVD registration, quality system, authorised representative and local testing support for the Iranian market. Our team manages IFDA registration applications, prepares reference-country dossiers, and supports post-market vigilance obligations. Business enquiries: info@grzanglobal.com