In 2019, Asia Pacific was the largest producer of pharmaceuticals and medical equipment, with a turnover value of USD770.5 billion. On account of the COVID-19 pandemic, short-term revenue contraction is set to occur. Yet, production is anticipated to return to growth in 2021 over favourable governmental policies.
Although turnover growth of Asia Pacific pharmaceuticals and medical equipment companies is expected to witness a considerable slowdown in 2020, the industry’s long-term outlook remains positive due to surging volume demand in China and increasing manufacturing capabilities in Indonesia and India. The region is expected to remain the primary driver of global medical products’ growth over 2019-2030.
Following the Coronavirus pandemic in 2020, China’s pharmaceutical and medical device production growth is expected to be slightly subdued, yet, maintain a strong growth, in line with the continuously improving business environment and government-mandated push towards innovation.
South Korea and Japan are poised for steady yet slower development, in comparison to regional peers, as the governments continue to implement regulatory pricing pressures. However, the two countries are anticipated to maintain their positions as world experts in innovative solutions, and raise exports value, capitalising on surging global demand for biologics.
One of the major outcomes from the Coronavirus (COVID-19) pandemic is set to be severe disturbances to global supply chains. The lockdown in China caused waves of supply process inefficiencies around the world, with Asia Pacific not immune. For example, India’s production of generic drugs was disturbed due to the drop in China’s API manufacturing. Over the forecast period, supply chains are anticipated to be restructured, alongside the countries implementing more protectionist policies.
Regional pharma companies are to suffer as multinationals are expected to transfer production to secure supply chains and minimise dependence on China. Whereas, the expected drop in foreign direct investment is likely to leave the industry vulnerable to external shocks.
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