Thailand’s pharmaceutical industry hit by import reliance, rising costs

In addition, production costs remain under pressure due to high energy prices and the increasing expenses associated with upgrading manufacturing facilities to meet international standards.

According to an analysis by the Office of Industrial Economics (OIE), both the production and sales volumes of pharmaceuticals in Thailand declined in the first nine months of 2024—by 7.2% and 8.5% year-on-year respectively. The downturn was mainly attributed to a slowdown in demand from both domestic and international markets.

These factors have significantly affected the profitability of pharmaceutical businesses. Moreover, Thai drug manufacturers are expected to face growing competition from low-cost pharmaceutical imports, particularly from China and India, which benefit from lower production costs.

Pharmacists: the backbone of Thai pharmaceutical security

Pharmacists play a vital role across various aspects of the pharmaceutical industry, including manufacturing, quality control, marketing, and the provision of medicines in hospitals and pharmacies. 

As such, pharmacists are involved throughout the entire pharmaceutical value chain—from upstream to downstream.

Pornsak Sriamornsak, dean of the Faculty of Pharmacy at Silpakorn University, told Krungthep Turakij that assessing Thailand’s pharmaceutical security requires considering whether the country can rely on its own capabilities, especially during emergencies such as the Covid-19 pandemic.

He explained that key considerations include whether Thailand has sufficient supplies of essential medicines, whether it can procure them to meet demand for prevention and treatment, and whether the country can carry out effective research and development for new drugs—from raw materials to manufacturing processes and equitable access to medication.

“Pharmacists are involved in every aspect of the pharmaceutical industry, from early-stage drug development and research to innovation and end-stage pharmaceutical services, including hospital and retail pharmacy services,” he said.

“The majority of pharmacists are engaged in research and academic fields. Issues such as drug pricing and industrial competition are generally overseen by the private sector, the government, or other relevant agencies,” he added.

Thailand’s reliance on foreign pharmaceutical ingredients

Thailand remains heavily dependent on imported raw materials for drug manufacturing, particularly in the production of generic medicines. 

The Covid-19 pandemic underscored the risks of this reliance when border closures disrupted cross-border shipments of pharmaceutical ingredients. Without domestic production capacity, the country must diversify its sources of imports to reduce future risks.

Pornsak noted that Thailand currently lacks the ability to produce APIs domestically, primarily due to cost-effectiveness and competition from global pharmaceutical powerhouses. As a result, it would be difficult for the private sector alone to establish local API manufacturing facilities.

Academic institutions, such as pharmacy faculties at various universities, therefore focus on producing qualified pharmacists who meet professional standards, possess expertise and ethics, and contribute to research and development.

Their efforts include work on generic drugs, pharmaceutical extracts, excipients, and modern drug technologies.

“The process of researching, developing and producing new medicines takes 10 to 20 years,” Pornsak explained. “It involves studying chemical structures, mechanisms of action, laboratory testing, animal trials, and eventually human trials, all under strict regulatory oversight.”

Due to the limitations in producing chemical-based medicines domestically, Thailand mostly focuses on herbal or natural products. These efforts are increasingly supported by universities, pharmacists, the government and the private sector, aiming to create a complete pharmaceutical value chain.

He added that accessing advanced pharmaceutical technologies requires substantial investment. Additionally, any drugs developed using such technologies must be registered with the Food and Drug Administration (FDA) to ensure safety, efficacy, and quality.

Balancing access to medicine with fair pricing

At present, competition in the generic drug market is largely price-driven. Hospitals and public health institutions tend to prefer lower-priced medicines, pushing domestic pharmaceutical manufacturers into a price war. 

This has significantly reduced profit margins, leaving companies with limited resources to invest in research, development, or advanced technologies.

Pornsak believes a balance must be struck between affordable access to medicines and pricing that is fair and sustainable. 

“Medicines should not be so cheap that there is no margin left for the private sector to reinvest in drug research and development,” he said. “At the same time, prices should not be so high that they become inaccessible to the public.”

He emphasised the need for a central coordinating body to help bridge research with practical applications. Such an agency could facilitate the commercialisation of research, leading to more effective pharmaceutical production and distribution that benefits both industry and society.

Producing pharmacists to strengthen Thailand’s pharmaceutical security

The Council of Pharmacy Deans of Thailand (CPDT), the Pharmacy Council of Thailand, and several professional pharmacy associations are actively working to enhance the quality and ethics of Thai pharmacists. 

Their joint efforts aim to promote the rational use of medicines, prevent unnecessary or excessive drug use, and raise awareness among students through improved pharmacy curricula.

Pharmacist training in Thailand is structured into three primary fields:

• Clinical pharmacy – working directly with patients in hospitals
• Pharmaceutical sciences and industry – focusing on research and product development
• Consumer protection – ensuring safe and responsible use of medicines

Each university follows curriculum standards and codes of ethics set by the Pharmacy Council of Thailand, which is responsible for licensing practitioners, accrediting degrees and certificates, and overseeing academic standards. 

While different institutions may emphasise different areas, all must comply with the council’s regulations to offer accredited programmes.

Thailand currently produces around 2,000 pharmacists annually. However, a shortage has been observed since 2024. 

This is largely due to the enforcement of Good Distribution Practice (GDP) regulations requiring a licensed pharmacist to be present at all times in every pharmacy. Although this requirement was introduced 7–8 years ago, it had been granted temporary exemptions until the past year, when enforcement became mandatory.

As a result, pharmacies without full-time pharmacists must either close or limit sales to over-the-counter medicines, excluding controlled drugs. 

There are approximately 5,000 pharmacies nationwide, and the new regulation has led to a drain of pharmacists from hospitals and industry into retail pharmacies, deepening the shortage. Recovery is expected to take four to five years.

“Ensuring national pharmaceutical security will require increased support for academic institutions to carry out drug research and development,” said Pornsak. 

“Universities must be empowered to explore new drug formulations and extract innovations, while the private sector must also be encouraged to invest. A central agency that connects academia with industry would help match research with real-world applications.”

He noted that medicine is one of the four essential needs, and with Thailand’s ageing population, demand and drug consumption are expected to rise steadily. 

“There is clear growth potential in the pharmaceutical sector, but strict standards must be enforced to ensure that all drugs produced meet quality and safety requirements,” he added.