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Singapore pharma sector an 'increasingly important' part of manufacturing: Fitch
FITCH Solutions Macro Research on Wednesday said Singapore’s pharmaceutical industry is becoming an "increasingly important" component of the country’s manufacturing sector.
This is seen by increases in employment and fixed asset investments in the pharmaceutical sectors, in contrast to overall decreases seen in the manufacturing sector as a whole.
In 2018, Singapore exported US$7.49 billion worth of medicine to leading destinations Switzerland, the Netherlands and Japan. As an entrepot, Singapore re-exports some of its imports which include pharmaceuticals.
According to data from the Department of Statistics, Enterprise Singapore and Fitch Solutions, Singapore pharmaceutical exports and imports have been on a steady rise the past three years, with Singapore being one of the few countries in the world with a positive pharmaceutical trade balance.
That being said, the change in monthly pharmaceutical exports from Singapore can be volatile, subject to changes in manufacturing outputs from new batches of active ingredients coming online, or products losing their patent protection and seeing a fall in demand.
Quoting data from the Economic Development Board, Fitch said the number of people working for pharmaceutical companies has risen to 7,356 in 2017, from 5,142 in 2011, contrasting with the overall decrease in employment seen in manufacturing.
Similarly, while the value of fixed asset investments fell for most industries, the pharmaceutical sector saw a total of S$440 million invested by pharmaceutical companies in 2017, up from S$197 million in 2012. There are 55 pharmaceutical manufacturing facilities in Singapore, a majority of which are foreign and include research and development-based companies.
Most recently, pharmaceutical giant GlaxoSmithKline unveiled a fully automated continuous manufacturing facility and an expanded production building at its Jurong site on Friday, worth a total of S$130 million. The new plant enables the continuous manufacturing of daprodustat, which is in phase III trials for the treatment of anaemia associated with chronic kidney disease.
The increasing importance of the pharmaceutical sector is also due to the Singapore government’s long-term ambition of developing innovative pharmaceuticals, Fitch said. This was seen from the formation of the Experimental Drug Development Centre (EDDC) in June 2019, which integrated A*Star’s drug discovery and development units.
"It is hoped that EDDC can better coordinate public-private partnerships in Singapore’s drug development ecosystem, and allow industry partners greater ability to translate discoveries into new medicines," Fitch added.
Fitch Solutions is part of Fitch Group, which also owns Fitch Ratings. Their research and commentary are independent of each other.