The State of the Pharma Industry in the Asia-Pacific Region

Pharma in Asia-Pacific (APAC) is going through the most booming period in its history. If you're interested in investing in the pharmaceutical industry in APAC, now is the best time to do that because numbers don't lie.?

According to one research, APAC will become the world's fastest-growing region in the pharma industry by 2028 due to a sizable consumer base, rising healthcare costs, increasing disease incidence, and supportive regulatory frameworks.?

Other research estimates that the APAC pharma market will grow from almost $70 billion in 2022 to nearly $153 billion by 2032.?

China and Japan are the world's second and third pharma markets, with a value of $153 billion and $83 billion, respectively.?

According to IBM Global AI Adoption Index 2022, countries from Asia-Pacific are more active in deploying and exploring artificial intelligence opportunities than countries from other parts of the world. China, India, and Singapore were the world’s top three geographies with the highest rate of AI implementation, outrunning the United States and the United Kingdom.?

China and India produce more than half of the world’s pharmaceutical ingredients, while Europe manufactures only a quarter.?

Nearly 50% of all clinical trials conducted in the world in 2021 had locations in APAC.??

The Pharmaceutical Industry in China?

The tremendous growth of pharma in China, a leading country in the region, facilitated the industry growth in the entire APAC region.??

The Chinese biopharmaceutical market experienced a 200% market capitalization increase between 2016 and 2020, which made it the world’s fastest-growing market.??

Statista reports that pharmaceutical retail sales in China amounted to almost 53 billion yuan in April 2023. It’s anticipated that consumer spending on medicine will increase because of increasing health awareness and a growing need for medical care due to the aging population.??

US import of Chinese pharmaceuticals has increased 485% within two years – from $2.1B in 2020 to $10.3B in 2022.??

China dominates the antibiotics market with over 40% of the export value.?

Challenges & Prospects?

If you look at the current trends in the Chinese pharmaceutical industry and try to make some predictions, there’s a high probability that many significant changes will happen. Both positive and negative.?

The domination of China, as the world’s largest producer of pharma ingredients, may stagger.???

Europe is reducing its dependency on China by reviving investment, reducing shortages, and boosting access to affordable drugs.??

India is planning to reduce its 70% import from China too by escalating its own production of pharmaceutical ingredients.??

We also may see more foreign investments in the Chinese pharmaceutical market. There are two main reasons for that.?

First, the country regularly updates its regulation policies and reduces taxes in some regions.??

Second, China relies on technological advancement as one of the main investment drivers as pharmaceutical giants from competitive markets invest millions of dollars in an AI startup that serves 200 countries worldwide.?

The Pharmaceutical Industry in Singapore??

In 2021, the value of the pharma market in Singapore was nearly 10.5 billion Singapore dollars, while the value of the medical equipment market was $4.7 billion, according to Statista.?

The pharmaceutical industry in Singapore is well-known for its emphasis on biomedical manufacturing. The government of Singapore allocated 4 billion Singapore dollars to the health and biomedical sciences domain.??

Biomedical manufacturing is the most valuable manufacturing sector in Singapore's economy, with around 600 million Singapore dollars in value.?

According to the Singapore Economic Development Board (EDB), Singapore manufactures 60% of the world's microarrays and a third of the world's thermal cyclers and mass spectrometers.??

Additionally, twenty-five multinational MedTech companies have established their R&D presence, and the world's fifty leading MedTech firms have their regional headquarters.?

Singapore has also recently become a hub for the vaccine market. Pharmaceutical companies built at least five vaccine plants to produce over one billion vaccines yearly.?

Eight of the top ten pharmaceutical enterprises have facilities in Singapore, producing four of the top ten drugs by global revenue.?

Challenges & Prospects?

In 2021, Trade and Industry Minister Chan Chun Sing announced a 10-year plan to grow the manufacturing sector in Singapore by 50% by 2030.??

As of Q1 2023, Singapore's annual growth rate of gross domestic product (GDP) accounts for 0.4%. It's the lowest index since the middle of 2021, when it accounted for record 15.8% because of increased demand for biomedical products during the COVID-19 pandemic.? ?

Despite a slight decline in manufacturing, Singapore tends to expand its influence in APAC pharma in particular and in the world’s pharma in general by attracting more local and global companies with an innovative ecosystem. It means that we’ll see more high-quality drugs and medical products made in Singapore in the future.??

The Pharmaceutical Industry in South Korea?

Yet in 2019, the Korean government decided to increase the world’s share of Korean pharmaceutical and medical devices from 1.8% or $14.4 billion to 6% or $50 billion by 2030. ?

In 2021, the market size of the pharmaceutical industry in South Korea amounted to 25.4 trillion South Korean won, and the market size of the biopharmaceutical industry amounted to 7.01 trillion South Korean won.?

Challenges & Prospects?

As Singapore and China, South Korea is seeking bigger investments for the biopharma industry.?

In May 2023, Merck, a top pharma enterprise, signed a memorandum with the Ministry of Trade, Industry and Energy and Daejeon City to build a next-generation bioprocessing center.?

Another goal within the South Korean pharma industry is to increase collaboration between the government and local businesses to make South Korea less independent from other countries and more innovative in drug development and clinical trials by boosting investments and cultivating human resources.??

Even though South Korean pharmaceutical companies developed over 500 pipelines, they still lack collaborative experience among big enterprises, research institutions, and universities, unlike the United States.?