Thailand: Critical Need for New Investment - Pharmaceutical Executive


Thailand: Critical Need for New Investment

Pharmaceutical Executive

Dr. Morakot , Director of Biotec
Within the policy, BIOTEC also has a plan to develop research for tropical diseases. "We think we have a lot of opportunity in this field because a niche for Thailand is biodiversity," Dr. Morakot pointed out. "One of our biotech focuses is to add value to biodiversity; therefore we are combining the biodiversity program with the tropical diseases research. With this combination, we can create a genomic outcome. This triangle put us in a good position."

If Dr. Morakot is conscious that, for the moment, multinationals are keener to inject capital into countries like Singapore, she refuses to see this situation as a curse. "In terms of investment, we are not as good as Singapore, but money is not the only thing, and we do have something that Singapore is lacking in: HR. In Thailand we have highly qualified people who have been trained abroad constantly bringing innovative ideas into the Kingdom."

"BIOTEC would really like to work as a partner, not as a recipient. We believe in partnerships and we guarantee that we can provide our future partners with good facilities and excellent HR power," insisted Dr. Morakot. For example, the Drug Discovery Partnership aims to find potential use of microorganisms and natural compounds as sources of innovative medicines.

As one of the first MNCs to take a chance on Thailand, Novartis won't be the one to contradict. "We see a growing biotechnology sector with a growing focus on healthcare. Thailand offers a unique biodiversity that may prove an excellent source to discover new drugs. We at Novartis have started a joint research project with the BIOTEC institute to do exactly that: help discover new drugs out of natural resources found in Thailand. The project focuses on technology transfer, training, and pharmacological assays on substances found. It's a long shot but we are hopeful of finding one or more interesting active substances in the next few years," said Peter Jager, country head for Novartis Thailand.

A Dispensary Market

Cyrille Buhrman
"If you work for MNCs, changes are natural, you will always be facing new openings and different challenges in different markets and you have to be ready to take them." According to Patrick Bruhlmann, CEO of the Hong Kong-based distribution company Zuellig Pharma, the Kingdom is very much driven by customized customer demands and high expectations from blue-chip pharmaceutical companies. Like many countries in the area, Thailand is a dispensary market where 66 percent of medications are directly distributed to hospitals. Distribution is under two main players (DKSH/Diethelem and Zuellig) sharing 95 percent of the market. Another important variation is the mechanism of prescription and dispensing of pharmaceutical products. In Asia, medicines are prescribed and dispensed at the same place. Hospitals give prescriptions and then dispense, as do doctors. Therefore there is very little release of prescriptions across pharmacy channels.

Delivery within 24 hours

As an exclusive distributor, Zuellig acts on service agreements and charges a percentage fee for services. "In Europe, USA, and Japan you have typical wholesaler markets. For example, they will buy X or Y product at $100 and sell it for $105, hopefully keeping the $5 profit. We operate differently, because we buy for 100 sell at 100 and earn a small service fee on the transaction," explained Bruhlmann.

With more than 300 salespeople servicing MNC customers, Zuellig makes sure its products are going into the right channels. It also performs a lot of secondary repacking and labeling in order to customize imported products to local market needs. Zuellig usually operates as a central distribution system. "We have a large, fully temperature-controlled facility where everything is stored. We take orders and invoice about 5,000 to 10,000 orders every day and make sure that everything is delivered within 24 hours. The 24-hour delivery is almost always possible unless we face very adverse climatic conditions," explained Bruhlmann.


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