Japanese drug-maker Nichi-Iko opens Thai office

The AEC will help the company reach all of the region’s markets. Under its pharmaceuticals framework, the bloc will launch a single drug-registration system for all state members.

Opened on April 9th, the office is the company’s first outside Thailand. Yuichi Tamura, the company’s president and chief executive officer, told The Nation that the move was aimed at helping Nichi-Iko play a bigger role in the Asian market.

He said that although Japan’s drug market is still showing significant annual growth, it’s time for the firm to expand outside of the country. It’s essential, Tamura said, that Nichi-Iko play a bigger role abroad, just as other international players have expanded their business network into Japan.

Currently, there are at least three foreign firms providing generic drugs in Japan, including Teva from Israel, Sandoz from Switzerland and Mylan from the United States. However, local producers still play an important role in the market.

Along with Hong Kong and Malaysia, Thailand was chosen in 2010 as part of its pilot project to launch its overseas expansion plan. The firm has appointed DKSH Business Unit Healthcare to help study the potential of all markets and to distribute its products.

Compared to the other two nations, the study showed that Thailand offers the most business potential, especially as it has a growing number of upper-middle-income earners with the money to spend on medicines. Also, the nation is considered the leading provider of medical services in the region.

In Thailand, its nine generic drug products will be introduced to the market in 2014, after being shipped from Japan. The drugs to be registered are associated with treatments of cardiovascular diseases, alimentary-canal ailments and diabetes.

In the future, Tamura said, if the company’s drug consumption volume in Thailand grows, it will look for strategic local partners to increase its business role here. To do so, several business models are available. One of the possible options is to form a joint operation with a qualified local drug producer to help manufacture under Nichi-Iko’s standards. Drugs produced here may be exported for sale in Japan as well.

Founded in 1965, the firm is currently Japan’s biggest pharmaceutical producer in term of sales, ranked 17th in the world. The firm has six manufacturing plants in Japan, with annual production output of 8 billion capsules and tablets annually, along with 100 million ampules and vials.

Until 2016, the firm has projected its sales will be on the rise, expected to total US$925 million (Bt26.84 billion) in 2013, $1.03 billion in 2014, $1.1 billion in 2015 and $1.3 billion in 2016. However, sales contribution from overseas are projected to remain tiny, at only 1 per cent, because its major sales will still be from Japan, where the market is still growing.

If its projections are on the right track, in 2016 the company will be one of the world’s top 10 drug producers.