South Korean pharmas eye overseas expansion through CPhI

SEOUL (The Korea Herald/ANN) - The biggest annual pharmaceutical industry-related event CPhI Worldwide has been attracting more South Korean firms in recent years, as they seek to expand overseas given the sluggish domestic market.

At the Korea Pavilion for CPhI Worldwide 2019 -- sponsored by the Korea Pharmaceutical Traders Association and Korea Trade-Investment Promotion Agency (KOTRA) -- 35 firms opened booths to exhibit their products and network with global clients.
The event was held from Tuesday through Thursday at Messe Frankfurt in Frankfurt, Germany.
Including the companies that opened individual booths, such as Samsung BioLogics and Daewoong Pharmaceutical, the number of participating Korean firms has risen to around 70 this year, even more if Korean-owned international pharma bodies such as SK Pharmteco are counted.
A European official of Samsung Bioepis was a panelist for a talk on the future of biosimilars, while others such as Celltrion opted to send representatives as event visitors without setting up booths. 
“In the early years, not many Korean companies thought of utilizing exhibitions as a means for overseas marketing. They were satisfied with the domestic market, and exports were not a big concern,” said Choi Yong-hee, team leader of export promotion at KPTA.
“There is a change in attitude now regarding how they perceive exports,” Choi said, “Not only has the government’s support increased, but also there is a limit to growth in the domestic market. The cutback on rebates and lowered medication costs in Korea has prompted the firms to seek more export opportunities.”
CPhI Worldwide was launched in 1990 and the first Korea Pavilion was opened in 1999. According to Choi, over the two decades KPTA and KOTRA have joined the CPhI Worldwide events, while the size of the Korea Pavilion has tripled.
On Wednesday, representatives of pharma firms from Ethiopia and those from the Commonwealth of Independent States were regular visitors at the pavilion.
Chong Kun Dang and Yuhan, both companies that have participated in CPhI Worldwide for around a decade, said they were holding numerous prearranged and walk-in business meetings.
Huons Global showcased its dental anesthetic, eye drops, botulinum toxin and fillers, while Daewoong Pharmaceutical attracted clients with its Nabota BTX.
The Korean pharma market is growing at an average annual growth rate of 6 percent and is expected to mark $10.4 trillion in 2020.
However, pharma imports still outnumber exports in Korea -- most of the exports are to Southeast Asian countries, China and Japan rather than the more lucrative Europe and US markets, Choi said.
In the end, the road to gaining competitiveness depends on the size of investments on research and development.
Big global firms such as Bayer and Boehringer Ingelheim annually invest trillions of won for R&D, while in Korea only a few companies inject that much amount of funds for the purpose.
One way the Korean government has stepped in to offer help was to join the international bodies for pharmaceutical quality control.
The Ministry of Food and Drug Safety joined the global Pharmaceutical Inspection Convention and Pharmaceutical Inspection Co-operation Scheme in 2014, International Council for Harmonization of Technical Requirements for Pharmaceuticals for Human Use in 2016 and the European Union’s Good Manufacturing Practice in 2018.
Memberships with these groups ensures the quality of Korean pharma products in the eyes of international players, said Kim Kwan-sung, the executive vice president at KPTA.
“In early ’70s, the main focus of Korean pharmas was active ingredients, but as the environmental regulations toughened, the companies have shifted attention to value-added medicines.” The trend now among Korean pharma firms is to focus on finished products and value-added pharma ingredients that poses no environmental threats, explained Kim. giving examples of Korea’s biosimilar manufacturers Samsung BioLogics and Celltrion as the ones that are after VAM.
As the population aging intensifies across the world, the demand for senior health care will incrementally rise, which opens more possibilities for affordable generics, or biosimilars, Kim opined.
There will be the inevitable learning curve -- a splurge in the number of biotech and biopharm companies will gradually sift out to leave only the real players to advance forward.
“If there is one thing the Korea bio market must overcome in order to grow further, it would be more investments,” Kim said.
Aggressive government investment is needed to foster the infrastructure and technology, and educate the pool of future manpower. As for the companies, they have to put in more efforts for overseas expansion, Kim urged.
Meanwhile, Goh Young-gon, the policy and regulatory affairs team manager from Korea Biomedicine Industry Association, delivered a session on the Korean biopharma market trends centering on recombinant protein products, vaccines and plasma derivatives, with the emergence of cell and gene therapy.
The next CPhI event is CPhI & P-MEC India from Nov. 26 through 28 in New Delhi, while the CPhI Worldwide 2020 will be held in Milan, Italy, from Oct. 13 through 15.

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