Research and Markets: the Outlook for Pharmaceuticals in South East Asia - the 8 Markets of This Region Have a Pharmaceutical Market Value of US$23.1 Billion

DUBLIN--(BUSINESS WIRE)--Research and Markets (http://www.researchandmarkets.com/research/47669b/the_outlook_for_ph) has announced the addition of the "The Outlook for Pharmaceuticals in South East Asia" report to their offering.

“The Outlook for Pharmaceuticals in South East Asia”

The emerging pharmaceutical markets of South East Asia are developing at markedly different speeds. Despite the negative impact of the global recession, the eight markets of the region have a pharmaceutical market value of US$23.1 billion in 2009, and are expected to continue to grow.

South Korea and Taiwan are maturing with improved IP standards and growing importance in pharmaceutical trade. For example, in January 2009, the USTR removed Taiwan from its Special 301 Watch List of countries, attributing the move to the country's progress on protection and enforcement of intellectual property rights. It is a marked difference compared to when the USTR described the country as a haven for pirates in 2001, the year it was first placed on the list.

At the other end of the scale, Vietnam, Indonesia and Thailand are introducing protectionist measures and tighter regulation on international pharmaceutical companies. For example, in a recent development which has tarnished the attractiveness of the Indonesian market for foreign drug companies, the Ministry of Health has introduced rules requiring drug companies to have production facilities in the country, in order to get licences to sell their products in Indonesia.

Complete quarterly-updated analysis to keep you informed:

Now you can easily evaluate these markets with The Outlook for Pharmaceuticals in South East Asia. Each report provides individual and highly-detailed analysis of the market, looking at the key regulatory, political, economic and corporate developments in the wider context of market structure, service and access. The reports are available individually, or as a discounted collection, and prices include four completely updated reports sent quarterly, together with a comprehensive statistical appendix. There are over 60 markets covered in the worldwide series.

INDONESIA The domestic pharmaceutical manufacturing industry is strong and the country has become an attractive base for many multinational producers to operate. This is largely down to a cheap labour force and generally inexpensive production costs. In March 2009, the government announced the merger between PT Indofarma and PT Kimia, saying the partnership, once materialised, will enable them to control a 15% stake of the market. PT Kimia president Sjamsul Ariffin said feasibility studies and legal processes would take at least six to nine months before the merger can be finalised. IPR protection is generally regarded as inadequate and counterfeiting is a major problem. The country has been placed on the US governments Priority Watch List in 2009.

MALAYSIA The government is keen to encourage local pharmaceutical production, particularly in the fields of biotechnology and the manufacture of off-patent drugs. Several incentives have been put in place, including tax exemptions for biotech companies that are awarded Bionexus status. Malaysia's biotech initiative has begun to attract a growing number of multinational companies investing in the country, in terms of manufacturing and research projects. Local manufacturers almost exclusively produce generics and other off-patent medicaments, both ethical and OTC products, but medicines imported by multinational manufacturers still command the lions share of the market, at over 70% in value terms. A possible FTA with the USA would make Malaysia a more attractive prospect for US pharmaceutical companies.

PHILIPPINES Changes to be brought by the controversial Cheaper Medicine Bill will impact the Philippines pharmaceutical market in a number of areas, including IP laws, competition and drug price control mechanisms. The market is expected to be especially volatile in the short term. The government has been criticised in the past for not doing enough to promote generics and has recently stepped up its efforts. For example, it has launched Project 100 which promises to offer cheap generics in 100 public hospitals around the country. Parallel imports have increased and the government has urged retailers and wholesalers to stock more generics, as part of its campaign to reduce the price of many essential medicines.

SINGAPORE The economic slowdown has already taken its toll on the manufacturing sector, and this will inevitably result in a further contraction of growth in pharmaceutical output in the short term at least. Incentives such as low corporate tax rates and strong intellectual property laws have enabled it to secure funding to invest in the biomedical manufacturing industry (pharmaceutical and medical devices) but recent economic events could result in negative growth in the future. Singapore acts as a key trading hub to connect South East Asia and the Western world and is a major re-exporter of pharmaceuticals. The country exports more pharmaceuticals than any other of the Asian Tiger economies by a significant distance, although the majority of this total is from re-exported goods.

SOUTH KOREA South Korea's pharmaceutical regulatory environment has always been a difficult one for international companies. Problems typically range from poor protection of data, especially in a market dominated by a large number of local manufacturers of generic drugs, to a lack of transparency in the review of drug prices by the authorities. In July 2009, the Korean Pharmaceutical Manufacturers Association (KPMA) and the Korean Research-based Pharmaceutical Industry Association (KRPIA) sought approval from the Ministry for Health, Welfare & Family Affairs for a fair trade agreement effective in August 2009 to outlaw rebate activity within the industry, including discounts on the price of drugs.

TAIWAN Taiwan has a strong healthcare system. Universal health insurance ensures that all citizens have grown to expect a high level of care. That said, like a lot of public welfare systems, the healthcare system is being constrained by rising costs, and a rapidly growing elderly population is adding to this. The Bureau of National Health Insurance (BNHI), which reimburses the prices of medicines, has run into a deficit in recent years, and has resorted to periodical price cuts which have naturally proven to be unpopular with the drug industry, particularly with the USA and several European suppliers, who remain major suppliers of pharmaceuticals to Taiwan. In March 2009, it was announced that the Science and Technology Advisory Group (STAG) of the Executive Yuan (Taiwan's cabinet) is to unveil a NT$60 billion (US$1.8 billion) biotech venture capital fund, with the aim of doubling the annual output of the country's biotech industry to NT$300 billion (US$8.8 billion) in four years.

THAILAND The industry appears to be recovering with both imports and exports showing impressive growth in recent years. The governments relationship with the international pharmaceutical industry continues to be uneasy, largely due to the country's lax patent laws and preferential treatment of domestic producers. The compulsory licensing of patented drugs by the government has further compounded this problem. The largest domestic drug manufacturer is the Government Pharmaceutical Office (GPO) which has a near monopoly over the public hospital sector; public hospitals are legally obliged to purchase 80% of their drugs from the GPO.

VIETNAM The government is focused on developing its domestic production capability which supplies just over 50% of the pharmaceutical market. However, rising raw material prices are a threat. It has been recently reported that three multinational distributors, Zuellig Pharma, Mega Product and Diethelm, dominate the pharmaceutical market through a complex network which enables them to control the volume, thus prices, of drugs distributed in the country. The government report has criticised both foreign suppliers and local importers for adopting strategies such as predatory pricing, boycotts, exclusive deals and patent pooling to block competition from new suppliers and importers.

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Source: Espicom Business Intelligence Ltd