Asia Poised to Become the New Biopharmaceutical Hub

Aug 21, 2007
By BioPharm International Editors

The center of gravity for the pharmaceutical market is shifting to the Asia-Pacific region from the US and Europe, according to an analysis published by PricewaterhouseCoopers (New York, NY, In addition to becoming the largest market in the world for drugs—led by growth in China, India, and Singapore—Asia Pacific is seeing an influx of multinational companies at the same time that its own pharmaceutical companies are acquiring international market share.

The report, “Gearing up for a Global Gravity Shift: Growth, Risk and Learning in the Asia Pharmaceutical Market,” is based on a survey of 185 senior pharmaceutical executives from 92 Asian-based domestic companies and 93 multinational companies with operations across nine different territories in the region, including China, India, Malaysia, Philippines, Singapore, South Korea, Taiwan, Thailand, and Vietnam.

Of the executives surveyed from multinationals, nearly six in 10 (58%) agreed that the center of gravity for the global pharmaceutical market is shifting to Asia Pacific. Asia’s domestic company executives were more certain, with 62% agreeing.

However, operational risks continue to be a concern despite progress in strengthening regulatory standards and intellectual property (IP) protections across Asia. Three quarters of the executives from multinationals said they are worried about IP and cited IP concerns as the biggest reason to consider leaving the Asia Pacific region. But nearly 74% of multinational companies and almost 79% of Asia’s domestic companies said they had seen an improvement in IP protections over the past five years.

Growth is at the top of the agenda for multinational companies extending their presence in the region and for many domestic companies seeking to go global. A third of multinational companies have immediate plans to further expand in Asia through acquisitions or by developing their own sites.

According to the report, more than a third (34%) of Asian-based domestic companies are looking to acquire pharmaceutical companies. More than half (52%) of these companies are seeking to acquire international market share. At present, fewer than half (45%) of the domestic companies surveyed had an international presence, but international growth is high on their agenda.

Looking ahead, multinational companies see a lot of room for continued outsourcing growth in the Asia. So far, much of the focus has been on outsourcing drug manufacturing, but increasingly, companies are outsourcing R&D and clinical trials to the region.

lorem ipsum