Asia’s medicine industry is estimated to be worth $170bn with a 12% annual growth rate, and growing Asian economies and their populations are the main factors that drive the demand for new therapies.

Companies are thus expanding their R&D networks and public private partnerships, undertaking research to improve their knowledge of strategic business opportunities in Asia, understanding the differences in Asian markets and the region's more common diseases, and developing therapeutic curatives customised for Asia, in some cases shifting some of their global manufacturing and supply chain emphasis to Asia. Some of these products include antibiotics, hormones, alkaloids, reagents, glycosides, vitamins and vaccines.

Governments in Asia are also developing their R&D infrastructure and capabilities to support their countries’ biotech and pharmaceutical industries. As a result, Asia is experiencing more product introduction and a growth in contract research organisations providing services such as biopharmaceutical development, biologic assay development, commercialisation, preclinical research, clinical research, clinical trials management and pharmacovigilance.

These developments positively impact the Asian financial services sector also, as some of these firms raise financing on the Asian stock exchanges and other financing and investment modes.

Challenges facing Asia biotech and pharmaceutical industries include rising costs caused by expiring drug patents, growing government regulations and monitoring on these sectors, and the demand for environmentally friendly manufacturing practices. In the medium term, Asia's biotech and pharmaceutical industries continue to face a healthy outlook.

Lawrence Yeo is CEO and principal consultant of AsiaBIZ Strategy, a Singapore-based consultancy that provides Asia market research and investment/trade promotion services. E-mail: lawrence@asiabizstrategy.com