Thai pharmaceutical makers are seeking additional incentives from the government to help attract investment worth more than 100 billion baht over the next 10 years.
Members of the Pharmaceutical Research and Manufacturers Association (PReMA) said after meeting the industry minister yesterday that the request for 13-15 years of tax incentives from the Board of Investment (BoI) would give a boost to the industry.
Atchaka: Eager to promote the sector
"The maximum incentive of an eight-year tax exemption from the BoI is not sufficient support for the industry, since producers require a long period of time before they start making a profit from the product," said a PReMA member who asked not to be named.
In 2015, Thailand's pharmaceutical exports were worth about 10 billion baht, the member said, but export value could rise to 75 billion baht over the next decade if the government lends support to the industry's proposal.
Broadening investment incentives from the BoI would attract more foreign investment.
Each pharmaceutical project investment is worth 5-10 billion baht.
The pharmaceutical industry operates within a global value chain with processes taking place in different countries but adhering to the same standards.
"Thailand has received only a small portion of research and development in the global chain of the huge pharmaceutical industry, and the country has been involved only in the downstream stage of research and production," the PReMA member said.
Thai pharmaceutical makers must rely on foreign partners that have adequate human resources and high technology to invest in the research and development process.
Confidence is a big concern for foreign investors in deciding whether to explore opportunities in Thailand.
The PReMA member said the most worrying issue for investors was efficiency and the long period of time in securing licences and other permissions from the relevant government agencies, such as approval from the Food and Drug Administration.
"Thailand has an advantage in terms of the size of its population and human resources, and with improvements in infrastructure and government incentives, Thailand could become the major pharmaceutical producer in the region," the member said.
Thailand is the second-biggest pharmaceutical producer in Southeast Asia after Singapore, followed by Malaysia, Indonesia and Vietnam.
Industry Minister Atchaka Sibunruang said the ministry accepted the request of the pharmaceutical makers and would discuss it, as the sector is one that the government is keen to promote.