KResearch is of the view that despite improving signs seen in the COVID-19 situation, which may cause demand for related medicines to decline from the preceding year, existing local patients and some segments of international patients, who have common diseases, are expected to gradually resume medical services in Thailand. Additionally, the number of patients with non-communicable diseases (NCDs) is set to increase after Thailand becomes a completely aged society in 2022. As a result, turnover in the Thai pharmaceutical market may reach THB233-238 billion in 2022, an increase of 3.0-5.0 percent YoY, against the 2.5 percent growth reported for 2021 (assuming that there is no severe COVID-19 caused by a new variant or new clusters).
Pharmaceuticals in Thailand are primarily distributed through state hospitals (60 percent) under the country’s universal health care and medical welfare systems, private hospitals (25 percent) and drug stores (15 percent). KResearch expects that drugs sold through public hospitals will increase ahead, especially for senior citizens as they are heavily dependent on the state medical welfare. Meanwhile, drug stores will experience increased competition from the proliferation of drug franchises and sales points at shopping malls. Spending on original drugs versus generic drugs is at 45: 55 of the country’s total drug spending.
Growth in the pharmaceutical market in Thailand will be enjoyed mainly by producers and importers because more than 70 percent of the turnover is contributed by imported drugs. Given this, we at KResearch are of the view that if Thailand wants to be less dependent on imported drugs, both the public and private sectors must collaborate to support the entire process of drug supply chains in terms of quality and manufacturing standards to build confidence and acceptance with users (particularly medical personnel), and promote the use of locally-produced drugs. Such efforts can begin with generic drugs for which Thailand has the manufacturing capacity, though Thailand will have to rely on imported original drugs as related R&D is time consuming and requires costly investment.