BMI's Executive Summary

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With its large population and growing economy, Indonesia should be an attractive market, but very low per-capita spending highlights the main obstacle to strong sales. Moreover, deficiencies of its patent protection and the sizeable counterfeit industry will continue to represent some of the major obstacles to foreign companies involved in the market. Nevertheless, rising population numbers, increased demand for medical services and healthcare sector modernisation will push market value up to around US$4.2bn by 2012, up from an estimated US$2.8bn in 2007.

With no price controls or national insurance, around 85% of drugs are paid for out-of-pocket, which forms the main market for multinationals. However, a number of the products manufactured by large foreign drugmakers are included in the US$400mn state-run Askeskin scheme for 60mn people on low incomes. While Indonesia runs a national essential-drugs list, the foreign industry continues to be frustrated over opaque inclusion criteria.

The retail sector received a major boost in June 2007 when the government launched a programme to increase the availability of cheap, locally-made versions of patented pharmaceuticals. Under the Apotek Rakyat (People's Pharmacy) scheme, restrictions on dispensing drugs have been loosened and a network of small pharmacy outlets will be encouraged.

Overall, Indonesia represents one of the least attractive pharmaceutical markets in the Asian region. In the recently revamped BMI's Business Environment Ranking table for the 14 key markets, Indonesia is found in the joint eleventh position, alongside Thailand and above only Pakistan and Vietnam. The largely rural population, excessive red tape and widespread corruption are some of the main factors responsible for high risks associated with involvement in the country's pharmaceutical market.

Contents

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Chapter 1 - Executive Summary

Indonesia Pharmaceutical Industry SWOT

Indonesia Political SWOT

Indonesia Economic SWOT

Indonesia Business Environment SWOT

Chapter 2 - Indonesia: Business Environment Ranking

Table: Asia Business Environment Rankings

Business Environment Ranking

Economics - Long-Term Risk

Politics - Long-Term Risk

Regulatory Barriers

Domestic Sector Threat

Market Growth Potential

Market Size Ranking

Chapter 3 - Indonesia: Market Overview

Chapter 4 - Regulatory Regime

Pricing And Reimbursement Developments

Industry Trends And Developments

Pharmaceutical Sector

Chapter 5 - Industry Forecast Scenario

Overall Market Forecast

Table: Drug Market Indicators

Key Growth Factors - Industry

Table: Health Expenditure Indicators

Key Growth Factors - Macroeconomic

Table: GDP And Population

Prescription Market Forecast

Table: Prescription Drug Market Indicators

OTC Market Forecast

Table: OTC Market Indicators

Generics And Branded Market Forecast

Table: Generics And Branded Market Indicators

Export/Import Forecast

Table: Sectoral Trade Indicators, US$

Other Healthcare Data And Forecasts

Table: Socio-Demographic Indicators

Key Risks to BMI's Forecast Scenario

Chapter 6 - Country Snapshot: Indonesia Demographic Data

Section 1: Population:

Demographic Indicators, 2005

Rural/Urban Breakdown

Section 2: Education And Healthcare

Education

Healthcare: Vital Statistics

Healthcare: Expenditure

Section 3: Labour Market And Spending Power

Employment Indicators

Consumption And Stratification

Wages Per Annnum

Chapter 7 - Company Monitor

Profiles: Leading Foreign Manufacturers

Sanofi-Aventis

Pfizer

Novartis

GlaxoSmithKline

Merck & Co

Indigenous Manufacturers

PT Kalbe Farma

Combiphar PT

Darya-Varia

Chapter 8 - BMI Forecast Modelling

How We Generate Our Industry Forecasts

Technical Process

Pharmaceutical Industry

Sources

Chapter 9 - Appendix: Regional Demographic Data

Manufacturing Wages (ave per annum), US$

Population

Household Spending Per Capita, US$

Private Consumption Per Capita, US$ PPP

Market Size, GDP, US$bn

Competitive Landscape for Asia Pharmaceuticals and Healthcare: Sample of Companies Ranked

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Cross-border analysis of regulatory systems comparing the patenting environment, summarising regional pricing and reimbursement factors and monitoring the growth of the Pharmaceuticals sector across the region. Company SWOTs cover leading multinational and national drug companies operating in each market.

Network of Asian Pharmaceuticals & Healthcare Sources

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BMI's Asian Pharmaceuticals Healthcare Reports are based on an extensive network of multilateral organisations, government departments, pharmaceuticals & healthcare industry associations, chambers of commerce and company reports. Information sources include: