North Asia has been leading Asia and even in some aspects, the world in producing novel therapies and drugs to combat everything from Alzheimer’s and dementia to rare diseases. But Southeast Asia, in particular, Singapore, Thailand, Malaysia and Indonesia have been souring under the radar, going through key clinical trials to one day commercialize key treatments for the world. Can Southeast Asia one day lead the world in producing novel therapies?
The Biotechnician has realized that to many people’s surprise, Indonesia is currently the largest pharmaceuticals market in Southeast Asia region, followed by Thailand, the Philippines, Vietnam, Malaysia and Singapore, according to Deloitte’s report called 2015 Life Science Outlook-Southeast Asia.
The Indonesian pharma market is valued at $6.5 billion. The sector recorded 85% growth from 2007 to 2013, with domestic companies holding 70% of the market share compared to the 30% owned by multinationals. The Indonesian pharma market is set for huge growth, says the report. It is, therefore, anticipated that overseas companies will soon be flocking into the region with foreign investments that could lead to innovative partnerships with domestic manufacturers in the long term. Investment from the local government will also help boost drug development.
It is likely that more international pharma firms will buy domestic facilities in Indonesia to help navigate the landscape as the demand for prescription generic drugs escalates. The fact that 83% of the local companies are cGMP certified makes it even more appealing to overseas multinationals looking to penetrate the Indonesian market.
Indonesia has also been teaming up with regional biotechnology and pharmatical powerhouses to enhance their competitiveness across the globe. Indonesia and India already initiated the bilateral cooperation, through the Agreement between the Government of the Republic of Indonesia and the Government of the Republic of India concerning Technical and Scientific Cooperation, which signed in Jakarta on 10 February 1982. The Agreement was ratified by Presidential Decree No. 27/1983, then it was renewed in 2001 and in 25th January 2011, in the form of the Memorandum of Understanding. At present, the 2011 MoU is still under the ratification process.
In the period of 2001-2014, various bilateral and regional co-operations with India, were successfully implemented. The regional co-operation with Indonesia is conducted through the ASEAN Committee on Science and Technology (COST) and the Non-Aligned Movement (NAM) S&T Center. From the bilateral cooperation perspective, the 2nd Indonesia- India Joint Science and Technology Committee (2nd JSTC) meeting was conducted, and resulted the Agreed Minutes which was signed on 19th October, 2010 in Kuta, Bali. One of the prioritized areas discussed in the 2nd JSTC, was Biotechnology. Therefore, the Indian Delegates conducted a working visit to Indonesia during the period of 15-19 December 2014.
Singapore-Where all the talent hides
Singapore has seen significant growth in the biopharmaceuticals sector over recent years as well. In less than 7 years, Singapore has become home to 9 biologics manufacturing facilities, including 3 latest investments by collectively, these biologics plants represent approximately S$2.4 billion in total investments and employ 1,700 people. Over the next 3 to 4 years, the burgeoning biologics industry is expected to create an additional 700 to 1000 jobs in Singapore. Even with this growing demand, the competitive pressures are increasing and companies are looking at changes in their operating models to sustain profitability and growth.
But Singapore has had one secret sauce to keep it highly competitive in big pharma and biotechnology, one, which has allowed it to maintain a lead over many of its neighboring Southeast Asian competitors. This secret sauce is attracting and maintain talent.
Kevin Lai, executive director, Biomedical Sciences and Consumer Businesses at the Singapore Economic Development Board, recently said Singapore’s rich talent pool and friendly business environment is one of the main reasons the country is able to continue to attract the region’s top talent in biotechnology.
“Attracted by the excellent physical and regulatory infrastructure, global connectivity and skilled manpower available in Singapore, many leading biopharmaceutical companies (including Abbott, GlaxoSmithKline, Lonza, MSD, Novartis, Pfizer and Sanofi-Aventis) have chosen to make Singapore their global manufacturing base. These companies operate multi-purpose plants with the capability to manufacture a wide range of active biopharmaceutical ingredients (APIs), biologics and nutritionals.”
Lai mentioned that Singapore uses various ways to ensure that they are able to maintain its talent for its growing biotechnology industry. “We have taken a proactive role in attracting key talent for our biologics sector. Our journey can be summarized in three words – “Dream, Design and Deliver”, which reflects our effort n thinking ahead about what the industry needs and how we can best support the needs of the sector.”
Indeed Singapore continues to work closely with industry partners and other government agency to develop and implement manpower initiatives to support the biopharmaceuticals industry in Singapore. The Sectoral Manpower Development Fund (SMDP) for the Biologics Manufacturing industry is a clear example of our commitment to talent development. The SMDP collaborates with a variety of organizations has the support of industry players including Abbvie, Amgen, Baxter, GlaxoSmithKline, Lonza, Novartis and Roche.
Industry players have also leveraged Singapore’s ecosystem to develop healthcare solution platforms, which aim to develop holistic solutions beyond individual products (e.g. Philips). This is another area that we have identified early-on.
One example would be in September 2013, when Philips announced the launch of its APAC Hospital-to-Home (H2H) business unit in Singapore. It illustrates how the industry is evolving to help health systems in Asia to address the growing challenges linked to a fast growing and aging population. Through healthcare innovation, Philips’ H2H business will seek to improve care transitions by offering re-admission management consulting, telehealth solutions for greater care continuity, and a personal health portal to engage patients and their families in their own health.
Although Malaysia’s biotechnology industry is still in its nascent stages, it has begun picking up speed with the support of the government. Since the launch of the National Biotechnology Policy in 2005, Malaysia has been actively involved in capacity building initiatives in support of its goal of becoming the regional hub for biopharma investments.
The country is ranked fourth globally for Biotech Enterprise Support in the Scientific American Report and second in ASEAN for intellectual property protection in the IMD World Competitiveness Index Yearbook.
Malaysia’s lead agency for biotechnology, the Biotechnology Corporation (BiotechCorp), opened its first office in San Francisco last month to provide assistance to US companies that are looking at a regional hub in Southeast Asia. And indeed, Malaysia’s biotechnology sector has accrued a total investment of RM12bil since 2011, surpassing the Government’s five-year target under the National Biotechnology Policy (NBP).
Vietnam is one of the most underlooked biotechnology markets in Southeast Asia, but foreign and domestic investment in the country has been increasing year-on-year. Currently there are 12 biotechnology related universities, 44 research institutes and research centers, and even six key laboratories in Vietnam, totaling $10 million a year.
But Vietnam faces a variety of issues before it can become a leading nation across Southeast Asia’s biotechnology industry. Dr Yong Chern Chet, Healthcare Sector Leader, Deloitte Southeast Asia told The Biotechnician that building a sustainable and thriving biotechnology industry is not as easy as it sounds, and that it will require support from the government to make it happen.
“The reality is that it does require a substantial amount of investment both in funds and in the training of human resource to fuel the growth of a sustainable biotech industry engine. Credit must be given to the Vietnamese government for making deliberate investments since the 1980s into specific biotech initiatives in addition to the 5 key national biotech laboratories (to the sum of 50 billion VND annually per laboratory) and over 40 plant cell and tissue culture labs throughout the provinces. I think for Vietnam, biotech success will come from a focused strategy to target areas of national priority like solutions in agriculture e.g. high yield, good quality and disease resistant crops or crops with medicinal properties,” said Dr Yong Chern Chet.
When Will Southeast Asia become a leading player in Biotech?
There are sparks of hope beaming from Southeast Asia’s biotechnology industry. Growth opportunities in Indonesia’s pharmaceuticals & biotechnology sector are in generics and biosimilars, vaccines, specialty medicine and new areas like stem cells and regenerative medicine, and Singapore’s biotechnology industry, and the Malaysian bio-based and biotechnology industry is expected to attract investments of RM5 billion from the United States (US) between 2016-2020. Vietnam, Singapore, and Thailand are also seeing new therapies and drops that can shift the momentum and attention to the region. But the key will be for the region to maintain and build a sustainable and innovative biotechnology industry, will be for governments to continue to support their industries through funding and continue to build universities to ensure the people have the talents to produce.