Pharmaceutical

SOUTH-EAST Asia’s (SE Asia) pharmaceutical market is positioned for rapid growth, driven by accelerating socio-economic development and a rising elderly population, according to MBSB Investment Bank Bhd (MBSB Research).

In a recent note, the firm projected the region’s pharmaceutical market to be valued at US$27 billion (RM114.48 billion) in 2024, with a compound annual growth rate (CAGR) of 8.1% over five years — nearly double the global average of 4.3%.

“This fast-paced growth positions ASEAN as a primary driver of global pharmaceutical expansion and an attractive destination for investment and market penetration,” it stated.

However, the research house acknowledged that achieving sustained success in the region requires a balanced strategy encompassing innovation, affordability, digitalisation, local production and strategic partnerships.

While SE Asia remains a net importer of pharmaceutical products, MBSB said there is significant untapped potential in local research and development (R&D) and manufacturing capabilities.

Urbanisation is another major growth catalyst. With the exception of Singapore — which has maintained full urbanisation since the 1990s — most ASEAN nations are expected to reach up to 90% urbanisation by 2030.

This trend will further push demand for more sophisticated and modern healthcare facilities.

The ageing population is also a critical factor. Increased life expectancy and lower birth rates are accelerating the need for chronic disease treatment, long-term care and geriatric medicine.

“Thailand and Singapore are leading in terms of population ageing. This creates opportunities to develop age-specific medications, such as treatments for Alzheimer’s disease, along with specialised elderly care facilities,” the firm added.

Vietnam and Indonesia were highlighted as major pharmaceutical markets in the region, due to their large population sizes and growing demand for healthcare services.

“However, growth dynamics vary by country, depending on the types of drugs being traded or manufactured,” MBSB Research said.

The firm mentioned that demographic shifts, lifestyle changes and government health initiatives — such as stronger medical tourism frameworks — also support the sector’s expansion.

On the issue of trade tariffs, MBSB Research warned that such barriers could significantly impact the pharmaceutical sector.

However, the negative effects can be mitigated through domestic R&D investment, local manufacturing and regional collaborations, supported by appropriate policies and government funding. — TMR