ASEAN-single-pharmaTen Southeast Asian nations have signed an agreement aimed at ensuring the safety, quality and lower prices of pharmaceuticals traded in the region

The Association of Southeast Asian Nations (ASEAN)’s economic ministers signed the deal, which will eliminate barriers to trade in pharmaceuticals between the member nations, at the group’s summit in Pattaya, Thailand on April 10, just before the planned three-day meeting was cancelled due to action by anti-government protesters. On April 12, Prime Minister Abhisit Vejjajiva declared an “extreme state of emergency” in Pattaya and the ministers were airlifted out of the resort.

Healthcare has been designated a priority sector in the creation by 2015 of the ASEAN Economic Community, a single market along the lines of the European Union, and the member states are required to have fully implemented the new agreement – the Sectoral Mutual Recognition Arrangement (MRA) for Good Manufacturing Practice (GMP) Inspection of Manufacturers of Medicinal Products – by January 1, 2011.

“Divergences in national product standards often act as impediments to trade in goods,” and the new MRA will enhance the competitiveness of drug makers in the region, said a statement from ASEAN. It will mean that “ensuring the safety, quality and efficacy of their products will become a priority,” and compliance will demonstrate that medicines are produced and controlled consistently in accordance with the agreed principles of GMP and quality standards among ASEAN regulators.

The MRA will also reduce costs for manufacturers, as they will no longer have to undertake repetitive testing or certification processes, while consumers will benefit from the assurance that the medicines they use are safe, the group added.

Manufacturing facilities will be inspected regularly and they will be required to demonstrate that they comply with the Pharmaceutical Inspection Cooperation (PIC/S) Guide to GMP, or an equivalent code, to fulfill the MRA’s obligations.

The pharmaceutical industries in each of the 10 ASEAN member countries – Brunei, Burma, Cambodia, Indonesia, Laos, Malaysia, the Philippines, Singapore, Thailand and Vietnam – are at very different stages of development. For example, the Indonesian industry is expecting growth this year to fall to 9% from recent annual rises averaging more than 12%, because of having to import all pharmaceutical raw materials. 95% of locally-manufactured products are sold on the home market, with domestically-owned firms already accounting for 70% of the total, says the industry association, GP Farmasi.

Another fast-growing market is Malaysia, where sales are estimated to be rising around 11% a year and expected to reach over $1.8 billion by 2012, according to Research and Markets. In Thailand, the Universal Healthcare Scheme, introduced in 2001 and then improved in 2006, is slowly bringing improved access to the poor, although the government’s compulsory licensing policy has brought it into regular conflict with leading western drugmakers and governments.

And in Vietnam, where the market is forecast to grow from $1.1 billion in 2007 to $2 billion in 2012, imports currently account for 50% sales, but government programmes aim to meet 70% of domestic demand through local production by 2015, rising to 80% by 2020.