Country Report: The Philippines - Pharmaceutical Executive


Country Report: The Philippines

Pharmaceutical Executive


Reduced medicine prices due to the MDRP scheme and the increased use of generics are contributing to the improved accessibility and availability of medicines. However, to truly achieve greater access to medicines, more cooperation is needed between the stakeholders.

Several pharmaceutical companies have already shown their commitment to this cause. Following the MDRP, a number of multinationals have declared 50% voluntary price reductions on key drugs. Sanofi-aventis initiated the Innovation for Life program, which reduced medicine prices for indigent patients in government-run hospitals. Novartis started a partnership with the Department of Health (DOH) to make the drug Valsartan available to public hospitals.

Janssen Pharmaceutica, a division of Johnson & Johnson Philippines, volunteered a 50% discount for products used in hospitals for open heart surgery. Jane Villablanca, general manager of Janssen Pharmaceutica, affirms that in her company, "there is a high commitment to making new innovative products available through partnering with the government and doctors, and to delivering healthcare to the people." Janssen also launched the Family Link program, which educates families of patients suffering from mental disorders, as well as a program that helps policemen deal with people suffering from mental diseases on the street. According to Villablanca, "these little steps have been accumulating for five years as small contributions in making a huge difference," and Janssen plans to continue making a difference in the Philippines.

Another company that has been contributing to improving healthcare in the Philippines is OEP Philippines (a subsidiary of the Taiwanese company Orient Europharma). OEP entered the Philippines in 2003 by acquiring Elan Pharma. The company, one of the key players in the generics segment and currently the 24th pharmaceutical company in the Philippines, launched several initiatives tailored to increasing access to healthcare.

JP Chang, general manager of OEP Philippines, explains how the company has been leveraging Taiwanese expertise to improve service delivery in the Philippines: "the insufficient budget allocated for public hospitals limits service for patients. Since the healthcare programs in Taiwan are mature and successful, we are seeking to put in place collaboration programs between the medical centres of the Philippines and hospitals in Taiwan for long term cooperation." In addition to inviting prominent Taiwanese doctors to the country to exchange knowledge and hold seminaries, OEP has also sponsored some patients to travel to Taiwan to undertake surgery in local medical centres. As Chang illustrates, "we can leverage our connection with institutions in Southeast Asia and Taiwan, and it will make us a unique generic company that better serves Filipino patients. I believe this will have some impact in the future, since healthcare should have no boundaries. Part of our obligation is to look into the welfare of the patients."


The majority of the multinational companies present in the Philippines are engaged exclusively in sales and marketing activities. Over the years, the MNCs which had manufacturing plants in the country closed down their facilities, and began to import from corporate production centres abroad, or turn to local contract manufacturers.

Roberto C. Taboada, General Manager, GSK Philippines
One prominent example of a multinational that kept production in the Philippines is GlaxoSmithKline, the No. 2 pharmaceutical company in the Philippines, and No. 1 among the MNCs. Roberto Taboada, general manager of GSK Philippines, explains that "manufacturing is mainly about costs. There are some products where manufacturing in the Philippines provides cost advantages, compared to bringing these products from other GSK plants." GSK also exports some products manufactured in the Philippines, especially for its consumer brands.

While many multinationals abandoned the Philippines, the local manufacturing industry became livelier. The number of laboratories declined over the years, as many were not able to cope with technological advancement and increasingly stringent requirements, but the ones that survived are Good Manufacturing Practices (GMP) compliant and at par with the latest technologies.

Some of these companies specialise in toll manufacturing, as in the case of Interphil Laboratories and Hizon Laboratories, the two leading players. Hizon Laboratories is one of the oldest pharmaceutical companies in the Philippines, established in 1898 as a manufacturer for drugstores. Over the years, it survived two World Wars, a Japanese occupation, and the destruction of its factory by a fire—but these events did not stop the company from becoming one of the leading players in contract manufacturing, thanks to its focus on quality products and services.

Even with decreasing medicine prices, Hizon Laboratories has never compromised on quality. Rafael Hizon Jr, member of the third generation of the family that founded Hizon Laboratories and currently its chief executive officer, points out that "at Hizon Laboratories, quality is built into the entire system of producing each batch. Manufacturing in relatively high volumes or big batches has helped us keep our prices competitive. There should never be a trade-off when it comes to the quality of our products."

In their quest to maintain high quality, Hizon Laboratories has been following international standards not only in developing and manufacturing products, but also in testing and evaluating. As the Philippines is getting ready for the ASEAN harmonisation and the local FDA is applying to join the PIC/S scheme, the company is prepared for more stringent requirements. Hizon explains, "as part of our continuous improvement, we have already incorporated some PIC/S standards into our system so as to be in stride with the Philippine FDA. We have also adopted most of the requirements of the ASEAN harmonised standards." Hizon's clients trust the quality of its products and services, and the experience that comes with more than 100 years of history—these are the factors that allow this local player to be the giant it is today.


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