Philippines Drug Market Update 2017

The Philippines, a Southeast Asian country made up of more than 7,000 islands, has a population of over 100 million people, making it the 12th most populous country in the world. The population grows by approximately 1.5 million people each year. The Philippines has the second youngest population in the Association of Southeast Asian Nations (ASEAN); as of 2017, the median age is 24 years old, and the average life expectancy is 73 years old.

The Philippines is the third-largest economy in ASEAN, behind Thailand and Indonesia. In 2016, the Philippines GDP adjusted for Purchasing Power Parity (PPP) exceeded $800 billion and is expected to grow to $879 billion in 2017, compared to $1.2 trillion in Thailand and $3.3 trillion in Indonesia. The 2016 GDP growth rate was 6.7% compared to 6% in 2015. The World Bank predicts the annual GDP growth rate in the Philippines in 2017 and 2018 could reach 6.9%, outpacing the predicted annual GDP growth rate in Thailand (3.2%) and Indonesia (5.2%).

 

Pharmaceutical Market

The Philippines is the third-largest pharmaceutical market in ASEAN and was worth $3.6 billion in 2016. The Filipino pharmaceutical market is predicted to exceed $4 billion by 2020, expanding at a compound annual growth rate of over 3.5%.

The government has also increased healthcare spending. In 2016, the Filipino Department of Health’s budget allocation grew by over 40% compared to the previous year. In 2017, government allocated $2 billion of its $67 billion budget to the Department of Health. The Philippines’ government aims to achieve universal healthcare coverage through “PhilHealth,” the national insurance plan. In 2017, the government allocated an additional $60 million to the PhilHealth budget.

Generic drugs dominate the pharmaceutical market due to an increasing number of government-owned pharmacies, which are called Botika ng Barangays (BnBs). The number of BnBs has nearly quadrupled since 2010, providing drug access to rural populations and increasing overall demand for pharmaceutical products. Currently, the 60% of pharmaceutical sales are generic drugs, while the remaining 40% are branded drugs.

However, foreign pharmaceutical companies still account for the majority of the drug market. US and European companies control over 70% of the Philippine pharmaceutical market. There are over 4,800 drug distributors and 650 drug importers in the country.

 

Diseases

The Philippines has a high prevalence of both infectious diseases and non-communicable diseases.

There are approximately two dozen new HIV/AIDS cases in the Philippines each day, making the Philippines one of the few countries globally where the incidence of HIV/AIDS is increasing. Additionally, the prevalence of tuberculosis has not decreased and remains one of the top ten leading causes of death in the country. Malaria and dengue fever, two mosquito-borne tropical diseases common to the region, also pose major problems for the Philippines. In the first five months of 2017, there were nearly 40,000 cases of dengue fever. In recent years, the number of cases of dengue fever per year has typically exceeded 100,000.

The Philippines’ disease burden is shifting from communicable to non-communicable diseases. Currently, non-communicable diseases account for nearly 70% of all deaths in the Philippines. Cardiovascular disease is the leading cause of death, and one in three deaths are caused by heart disease. Other leading causes of death include diabetes and cancer. Lung cancer contributes to the highest number of cancer-related deaths among men and third-highest number of cancer-related deaths among women, behind breast and cervical cancer.

Individuals in the Philippines are at risk of developing non-communicable diseases due to tobacco use, hypertension, and diet-related conditions such as diabetes and high cholesterol.

 

Filipino Regulator

The Filipino Food and Drug Administration (FDA) is the main body for pharmaceutical regulations in the Philippines. The FDA handles the registration of processed foods, drugs, medical devices, in-vitro diagnostic reagents, cosmetics and household hazardous substances.

The FDA also determines whether products are classified as food, drugs, or cosmetics. Companies may apply for product classification through the FDA by submitting product samples and related application documents.

 

Drug Registration

To register drugs with the Filipino FDA, pharmaceutical companies must have a License to Operate (LTO). A LTO application approval usually takes 90 days.

Requirements for a Drug Registration Application include:

– Certified Form No.8

– A valid agreement between the manufacturer and Trader/distributor/importer/exporter

– A valid License to Operate (LTO) of the manufacturer/trader/importer/distributor reflecting the corresponding source(s)

– Unit Dose and Batch Formulation (in metric system)

– Technical Specification of ALL RAW MATERIALS

– Certificate of Analysis of Active Raw material(s) and Finished Product(s) from the manufacturer

– Technical Specification of the FINISHED PRODUCT

– Master Manufacturing Procedure, Production Equipment, Sampling and In-Process Controls, and Master Packing Procedure

– Assay and other test procedures including Assay with Data Analysis, if applicable

– Stability Studies along the Philippines national guidelines and ASEAN HARMONIED guidelines

– Representative Sample in market or commercial presentation (at least 1 year before expiry)

– Labeling Materials

– Copy of ASEAN Center for Biodiversity (ACB) approval

– ORIGINAL Certificate of Pharmaceutical Product in the manufacturing country (must be written in English)

 

Foreign Drug Companies in the Philippines

Pfizer, AstraZeneca, GlaxoSmithKline, Novartis, and Wyeth are some of the biggest foreign pharmaceutical companies in the Philippines. GlaxoSmithKline and AstraZeneca also own manufacturing facilities in the Philippines that produce drugs for both the Philippines and other Southeast Asian markets.

 

Conclusion

Both economic and population growth make the Philippines pharmaceutical market one of the most attractive in ASEAN. Additionally, the government’s aim to provide affordable, safe and effective healthcare to all Filipinos will contribute to further growth.