By Justine Irish D. Tabile, Reporter
THE PHILIPPINE pharmaceutical industry is targeting at least 9% growth this year amid the implementation of the universal healthcare law, an industry group said.
“The growth is estimated at 9%. The increase is driven by requirements in the implementation of the universal healthcare law,” Philippine Pharmaceutical Manufacturers Association (PPMA) President Higinio P. Porte, Jr. told BusinessWorld.
In particular, he said that the industry is banking on the implementation of the universal healthcare law’s outpatient drug benefit program.
“The outpatient drug benefit will be rolled out this year, wherein outpatients visiting health centers or public hospitals once given prescriptions will be provided vouchers that they can redeem in public hospitals and accredited drugstores,” he added.
The PPMA currently has 75 members, of which 45 are manufacturers and traders of drug products. Other members include major suppliers of raw and packaging materials, medical machines, and services.
Last year, the local pharmaceutical market was estimated at P285 billion, representing a 5% growth from the P270-billion market value in 2023.
If the 9% projection is realized, it means the local pharmaceutical market will reach P310 billion in market value this year.
However, only 34% of the estimated total market value in 2024 are products manufactured locally, according to Mr. Porte.
Although there are improvements in the approval of certificates of product registration (CPR), he said the lengthy process remains a concern for the sector.
“Although the delays in CPR and licenses approval significantly improved, about half of applications are beyond Citizens’ charter,” he said. “These delays have a great impact on the launches of new products both locally manufactured and imported.”
Sought for comment, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said that the reason must be because of the economies of scale in other countries.
“The global supply chain [for pharmaceutical products] is strong. India, which is a source for many countries, already has economies of scale,” he said in a Viber message.
“They offer the best global technologies at the lowest possible cost or price, benefiting developing countries,” he added.
However, he said that there is an opportunity to increase the local share of manufacturing amid changes in the global supply chain and worldwide distribution.
“Let’s see if Trump’s higher tariffs, reciprocal tariffs, and trade wars would adversely affect the global supply chains and worldwide marketing or distribution,” said Mr. Ricafort.
Last month, US President Donald J. Trump said that he will impose 25% or higher tariffs on pharmaceutical imports with plans to increase it over the course of a year, along with his plans to impose tariffs on vehicle and semiconductor chip imports, Reuters reported.
The US is the largest market for most Indian generic drugmakers, accounting for 31% or $8.7 billion of the industry’s overall exports last year.
Mr. Ricafort said that the Philippines can be an attractive market for global pharmaceutical giants since it has the 12th largest population in the world.
“There are still opportunities to produce or manufacture in the Philippines for the local and export market, but that would require more investments in research and development and other high-tech facilities,” he added.
Last year, President Ferdinand R. Marcos, Jr. proposed the idea of establishing pharmaceutical economic zones in the Philippines to serve as one-stop shops to make the drug application process more accessible and efficient.
“We are still at the developing stage of our pharma parks, of which we have already established one in Tarlac,” said Philippine Economic Zone Authority (PEZA) Director-General Tereso O. Panga.
“In addition, PEZA looks forward to the groundbreaking of ZEN Industrial, the first Active Pharmaceutical Ingredient manufacturing facility in the Philippines,” he added.
Mr. Panga said that the primary objective of the pharma zones is to enable the Philippines to have a stronger pharmaceutical manufacturing footprint and increase access to affordable medicines.