Rapid growth expected in Thai pharmaceutical market

Thailand's pharmaceutical market was worth about US$2bn in 2006, and is the second largest market in S E Asia, after Indonesia.

However, it is the fastest growing in the region and is expected to grow at about 10-15% per year over the next five years, compared with 5.5% for the Philippines and 10% for Indonesia.

Some 64% of drugs are distributed through hospitals (80% through government and 20% through private hospitals), 26% through retail pharmacies, and 10% through health centres, private clinics and direct sales. The prescription sector accounts for approximately 56% of total sales value.

A major negative effect on further growth is that global pharmaceutical companies have been consolidating their manufacturing bases in countries other than Thailand. Previously 10 multinationals manufactured their drugs in Thailand, including Glaxo-Welcome, Warner-Lambert, Takeda, Hoechst and Schering-Plough. Today, none has its own production facilities in Thailand, but have outsourced drug manufacturing for products sold locally to domestic contract manufacturers.

In addition, domestic manufacturers focus on formulating drug products from imported active ingredients and manufacturing generic products. In contrast to China and India, no multinational companies have established r&d centres in Thailand, although some carry out clinical trials.