|
|
 |
|
Viewing report
|
|
|
|
Indonesia Pharmaceuticals and Healthcare Report Q3 2009
Business Monitor International, July 2009, Pages: 90
Business Monitor International's Indonesia Pharmaceuticals and Healthcare Report provides industry professionals and strategists, corporate analysts, pharmaceutical associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Indonesia's pharmaceuticals and healthcare industry.
Despite the impact of the global financial crisis, Indonesia’s drug market is still expected to grow substantially in 2009. According to the Indonesian Pharmaceutical Association (GP Farmasi), drug expenditure should expand by 9% this year. BMI’s own forecasts are slightly lower and the publisher expects the market to grow by around 8% in nominal terms in 2009 to reach a value of US$2.7bn. By 2013, the market should reach a value of US$4.7bn, representing a compound annual growth rate (CAGR) of 11%. However, in real terms BMI believes that the drug market will contract in 2009 due to the impact of high inflation. Other negative factors weighing on the market include the soaring cost of drugs, which are reducing volume sales.
Times are tough for Indonesian drugmakers. They have limited capability to make active pharmaceutical ingredients (APIs) and are therefore dependent on imports, mainly from China, a situation exacerbated by currency fluctuations which in turn impact profit margins. As reported by the Jakarta Post, Syamsul Arifin, deputy chairman of the GP Farmasi claimed that ‘As long as it [rupiah/dollar exchange rate] is below INR12,000 to the dollar, we can still survive.’
Because of intense competitive pressure, two Indonesian pharmaceutical companies agreed to merge in March 2009. Following the completion of feasibility studies and legal processes, the integration of PT Kimia Farma and PT Indofarma is expected by Q409. BMI notes that the deal underlines their core view that M&A activity will increase due to the efficiencies realised from consolidation.
In 2008, Indofarma and Kimia Farma recorded foreign exchange losses of US$1.46mn and US$428,000, respectively, due to the necessary import of raw materials. To prevent this from happening again, the new entity aims to be a full spectrum player. A chemical division will provide APIs to the pharmaceuticals business. To maintain the integrity of the supply chain, a distribution arm will link up with proprietary retail outlets. The company will also have an interest in healthcare equipment.
The tie-up was also stimulated by planned reforms to trade within the Association of Southeast Asian Nations (ASEAN) region. ‘In 2011, the pharmaceutical market in the ASEAN countries will be integrated [in one market]. The merger is a strategy to prepare us for the upcoming competition,’ said M. Sjamsul Arifin, president director of Kimia Farma. By 2011, the 10% tariff on pharmaceuticals entering Indonesia will be reduced to zero.
In the BMI Business Environment Rating matrix for Q309, Indonesia occupies 12th position out of the 15 regional markets surveyed in the Asia Pacific region. Main drawbacks to investment in the country include corruption, low per capita spending on pharmaceuticals and a small proportion of the elderly in the country.
Customers who bought this item also bought
Indonesia Pharmaceuticals and Healthcare Report Q4 2009
Indonesia Pharmaceuticals and Healthcare Report Q4 2008
Indonesia Pharmaceuticals and Healthcare Report Q3 2008
Indonesia Pharmaceuticals and Healthcare Report Q2 2008
Indonesia Pharmaceuticals & Healthcare Report Q3 2007
The Pharmaceutical Market: Indonesia
Venezuela Pharmaceuticals and Healthcare Report Q4 2009
Indonesia Pharmaceuticals and Healthcare Report Q1 2009
India Pharmaceuticals and Healthcare Report Q4 2009
Indonesia Retail Report Q1 2010
China Pharmaceuticals and Healthcare Report Q4 2009
Lebanon Pharmaceuticals and Healthcare Report Q4 2009
|
|
|
|
