South Asian region is the next big destination for Indian pharma. The growing patient pool, ageing population and advanced healthcare systems all make the region an attractive destination for newer drugs as well as for higher investments.
The eight South-East Asian markets of Indonesia, Malaysia, Philippines, Singapore, South Korea, Taiwan, Thailand and Vietnam is projected to have a total pharmaceutical market value of US $69.1 billion at retail prices by 2016 and is seen to be the next big destination for the pharmaceutical industry, according to Pawan Chaudhary, CMD, Venus Remedies.
While the Indonesian healthcare market is worth $24 billion and is estimated to reach $31 billion by 2016, the $20-billion South Korean market is growing at a CAGR of 6.5 per cent. The pharmaceutical market of Thailand, on the other hand, is expected to be worth $9 billion by 2020 from $4 billion in 2013, more than a two-fold increase in just seven years, Venus chief added.
Pharma experts concur that encouraging governmental assistance, sophisticated facilities and strict regulations in countries like Singapore and Malaysia are the favourable factors for pharmaceutical and biotechnology industries growth in the South East Asia.
Specifically simplified investment regulations including the 10-year tax holiday, duty exemptions, dependable infrastructure, tailor-made incentives for big investments, free-trade agreements with nil restrictions on equity in the Association of South East Asian Nations(ASEAN) region have made the region especially Malaysia an attractive destination. The stringent regulatory framework in Singapore has seen the country attract considerable contract research and clinical research activities, noted the experts.
The Epsicon Business Intelligence report indicates that eight pharmaceutical markets of South East Asia are developing at markedly different speeds and are characterized by contrasting macroeconomic factors. These markets are projected to have a combined pharmaceutical market value of US$80 billion at retail prices in 2017.
For the government of India, the 'Look East' policy realizes the potential of doing business with the ASEAN. There is enormous potential for trade and cooperation between the 10-member ASEAN countries comprising Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei, Myanmar, Cambodia, Laos and Vietnam.
India became a sector-specific dialogue partner of ASEAN in 1992, which was advanced to a full dialogue partnership in 1996. In 2011-12, the ASEAN-India trade touched $79.3 billion, which is above the target $70 billion for 2012 set in 2009. The government is looking to accelerate trade revenues to $100 billion in 2015 enabling Indian pharma and healthcare sector to cash in on the promising growth prospects.
India pharma feels that Malaysia and Singapore may increase investments in research and manufacture going by the favourable government policies. The positive investment climate has lured three companies from Karnataka Strides Arcolab, Biocon and Stempeutics to set up facilities here.
According to Gurudatta GG, chief executive officer, Estima Pharma Solutions, pharma in South East Asia has been engaged in the manufacture only for their domestic consumption. Now the companies in the region are aggressively building up the required expertise to entice global majors for contract manufacture orders.
“This region is now setting a new direction in growth in pharma outsourcing and is now scouting for competent consultants to trigger many global audits,” added Gurudatta.
"In general, the South-East pharmaceutical market has been steadily growing over the past decade. The generic drug industry is one avenue that is rapidly developing in this part of the world. Companies want to capitalize on this and are spending considerable time in developing strategies to exploit the full potential of the generic drug industry. This upward trend will definitely influence the pricing of drugs and make medicine more affordable. Many of the larger firms have managed to grow their market share through intensive competitive pricing,” pointed out Ariff Khan, president, manufacturing, Kemwell Biopharma.
“There is tremendous scope for growth. There are several opportunities in South East Asia which fit into our export strategy. The new regulations of doing business in the region, encouraging environment and market interest have been extremely gratifying,” said Archana Dubey Mitra, vice president, exports, Bal Pharma.
The Rs. 182 crore Bengaluru-based formulations and active pharmaceutical ingredients (APIs) manufacturer, Bal Pharma, has been adhering to the Technical Requirements for Registration of Pharmaceuticals for Human Use. “Our formulations are exported to Philippines, Myanmar, Sri Lanka, Vietnam and Cambodia. Our APIs are shipped to Taiwan, Indonesia and Malaysia. Therefore, there is a big scope for Indian pharma in the small-and-medium segment to register products and comply with national requirements, said Mitra.
Venus Remedies, a research-driven global pharmaceutical company based in Panchkula is present in many South-East Asian countries like Indonesia, Myanmar, Thailand, Vietnam and Philippines since 2008. Catering to South-East Asia with a basket of 24 products in the oncology and anti-infective (cephalosporin and carbapenem) segments, the company is gaining firm ground in this fast-growing market. The company has not only secured patents and marketing authorizations for its research products like Elores, Potentox and Ampucare from Singapore, South Korea, Philippines and Myanmar, it has also signed an exclusive marketing deal with Goodwills Co. Ltd. in South Korea for Elores, which has bagged regulatory approvals under the Korean FDA.
“We are growing at a steady rate in all the South-East Asian countries. We are looking to expand our business in these markets by concentrating on high-revenue products catering to unmet medical needs. Being a vast and growing pharmaceutical market, South-East Asia offers many untapped opportunities. Hence, we are poised to capture a sizeable share in South-East Asian markets,” said the Venus chief.
According to Rajiv Gandhi, CEO & MD, Hester Biosciences Ltd, the animal vaccine market in South - East Asia is growing rapidly because of the poultry and cattle population. The demand for animal vaccines is mainly met by imports in this region. We see ourselves to be a major supplier of animal vaccines and other health products. Our geographical location of being in India with an ability to manufacture international standard products , gives us a strategic advantage in this market. The company has its South East Asia regional office in Chi Minh City, Vietnam, which looks after the sales and technical services for the region.
The Ahmedabad-based Hester is currently exporting its products to eight countries and product registration activities are on in over 20 countries. Among South East Asian countries, company currently exports to Nepal, Myanmar, Vietnam and Indonesia and is exploring opportunities to enter Taiwan and South Korea soon.
Anglo French Drugs & Industries too has a presence in South East Asia and markets its products to Myanmar.
“The ever-increasing affluence, a rapidly ageing population and the steady extension of public health insurance are among the factors that make South-East Asian countries an ideal destination for pharmaceutical companies. Characterised by both contrasting and similar macro-environments, the eight South-East Asia markets are developing at an impressive pace, promising huge market opportunities,” noted the Venus Remedies chief.
Pharmacy and healthcare initiatives
The Federation of Asian Pharmaceutical Associations (FAPA) is now working to expand the pharmacists’ roles in wellness and sustainable health. The Association which observed its golden jubilee in 2014, is an 18 member organization representing pharmacists across the Asian continents.
The WHO’s South-East Asia region comprises 11 Member States of Bangladesh, Bhutan, Democratic People’s Republic of Korea, India, Indonesia, Maldives, Myanmar, Nepal, Sri Lanka, Thailand and Timor-Leste.
In September 2014, the health minister from Bangladesh, Bhutan, India, Nepal and Thailand inked a Memorandum of Understanding to collaborate in the elimination of Visceral Leishmaniasis (kala-azar) from their countries. Over 147 million in this region are at risk of contracting this life-threatening disease, mainly in Bangladesh, India and Nepal, with recent, sporadic cases being reported from Bhutan and Thailand. Areas for collaboration among the five countries will include resource mobilization, exchange of information, inter-sectoral collaboration for research, capacity building and technical support. “Kala-azar elimination is within our reach and WHO is committed to it”, said Dr Poonam Khetrapal Singh, WHO Regional Director, South-East Asia.
“We now have field- friendly diagnostic tools and effective medicines for its treatment. WHO has negotiated for an assured free supply of drugs to endemic countries till 2016 end. The elimination strategy includes access to early diagnosis and treatment for the most vulnerable populations together with vector surveillance with emphasis on improvement of the environment, social mobilization, research and networking,” added Dr. Singh.