ANTARA :: Indonesia gets tough with foreign drug companies

[Giuseppe]

ANTARA :: Indonesia gets tough with foreign drug companies

11/25/08 05:50

Indonesia gets tough with foreign drug companies

Jakarta (ANTARA News) -

Foreign drug companies can quit Indonesia if they do not like new rules requiring them to have local production facilities, Health Minister Siti Fadilah Supari said Monday.


Rules introduced earlier this month are designed to encourage foreign companies to transfer technologies to Indonesia and boost investment to create jobs, she said.

"If they want to get licences (to sell their products) they have to invest here also, not just take advantage of the Indonesian market," Supari was quoted by AFP as telling Dow Jones Newswires.

"They can't just operate like a retailer here, with an office size that's three metres (yards) by three and make billions of rupiah. That is not fair."

The decree, which has drawn protests from the US Chamber of Commerce, will affect 13 international pharmaceutical companies that currently sell their drugs in Indonesia but do not have production facilities here.

The affected companies include Wyeth, Eli Lilly and Merck Sharp & Dohme Corp. of the United States, Switzerland's Roche, France's Servier, Denmark's Novo Nordisk, AstraZeneca of Britain and Astellas Pharma of Japan.

Under the new rules, foreign companies have a two-year grace period in which to set up production facilities.

Supari said she believes Indonesia's big drugs market -- worth around two billion dollars a year -- would persuade the companies that building production facilities is worthwhile.

Those who fail to do so would be banned from selling their products or distributing them through companies that do have plants in Indonesia.

"If they want to go away, go ahead," she said. She added that India and China had already enacted such requirements.

The president and chief executive of the US Chamber of Commerce, Thomas J. Donohue, last week sent a letter to President Susilo Bambang Yudhoyono, urgingthe president to "consider revising the decree."

There are 29 international pharmaceutical companies marketing their products in Indonesia, with total market share of 25 percent.

The minister said the new rules will give "fair treatment" to pharmaceutical companies that have already invested in drug production facilities in Indonesia. (*)
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<cite cite="http://www.antara.co.id/en/arc/2008/11/25/indonesia-gets-tough-with-foreign-drug-companies/">ANTARA :: Indonesia gets tough with foreign drug companies</cite>

[Shiloh]

Re: ANTARA :: Indonesia gets tough with foreign drug companies

Source: http://www.reuters.com/article/rbssH...40152720081126

Indonesia says big market should spur drug makers to invest more
Wed Nov 26, 2008 5:21am EST
By Olivia Rondonuwu

JAKARTA, Nov 26 (Reuters) - Indonesia's huge market for prescription drugs should encourage foreign pharmaceutical firms to set up production plants in the country and comply with a new government decree, the health minister said on Wednesday.

The new rules, issued earlier this month, require foreign drug companies to set up production facilities in Indonesia in order to receive licences to sell their products there. Firms will have a two-year grace period to make the investments.

The decree, which also includes a provision on transfer of technology to Indonesia, is likely to affect foreign drug makers such as Merck Sharp & Dohme Corp, Johnson & Johnson (JNJ.N: Quote, Profile, Research, Stock Buzz) of the United States, AstraZeneca (AZN.L: Quote, Profile, Research, Stock Buzz) of Britain and Servier of France.

"Big pharmacy companies only need a small room and two workers (in a country), and then the whole profit is brought back to their countries. I want fairness," Siti Fadillah Supari said in an interview with Reuters and a local magazine.

"I am not against working with foreigners, but the deal should be fair ... I have the market, the biggest in ASEAN (Southeast Asian region)," she said.

Supari said 30 percent of the world's fourth most populous country of 226 million people are able to buy expensive drugs. The country's total drug market is worth more than 20 trillion rupiah ($1.66 billion) a year.

Indonesia still imports drugs for cancer and heart diseases. Currently, there are 208 pharmacy companies in Indonesia, of which 31 are foreign.

Supari, who has clashed with the international community and United States over her handling of health issues, also said the World Health Organization was close to agreeing on a fairer mechanism for sharing information on viruses, which could be agreed upon as early as next year.

Jakarta has refused to share bird flu samples, saying it wants guarantees from richer nations and drugmakers that poor countries would get access to affordable vaccines developed from their samples.

Indonesia has the highest bird flu toll of any nation. Some 112 people have died because of the disease.

International health experts say it is vital to have access to samples of the constantly mutating H5N1 virus, which they fear could change into a form easily transmissible among humans and sweep the world in months, killing millions of people.

Supari denied Indonesia was trying to hide the extent of the bird flu problem in the country by announcing death figures only once in six months and said the number of cases this year was about half the number last year.

"Why must we cover the cases, with the strain's virulency? Indonesia is not that bad compared to other countries with smaller areas and lesser populations," she said. ($1 = 12,050 rupiah) (Editing by Sugita Katyal & Kim Coghill)