JAKARTA, Jan 10 (Reuters) - Indonesian state-owned pharmaceutical companies Kimia Farma and Indofarma expect the country’s new national healthcare scheme to lift demand for generic drugs, pushing up overall sales this year by 15 percent.
Southeast Asia’s biggest economy launched the scheme on Jan. 1 to provide free and subsidized services to its 240 million people by 2019.
Generic drugs are near copies of drugs whose patents have expired. They are often cheaper, making them attractive to state-run hospitals and clinics.
“The national healthcare program will lead to a rise in the generic drugs market,” Kimia Farma President Director Rusdi Rosman told reporters on Thursday.
Kimia Farma expects sales of around 5.3 trillion rupiah ($434.8 million) from 4.6 trillion rupiah last year, and aims to increase its number of clinics to 1,000 over the next few years from 200 at present, Rosman said.
Indofarma projects overall sales of around 1.4 trillion rupiah from 1.2 trillion rupiah, Finance Director John Sebayang told Reuters on Friday.
“We have a 20 percent market share in the sale of generic drugs, so even though the margins are small, the high volume will make our income bigger.”
Kimia Farma and Indofarma are likely to benefit most from the new healthcare scheme as generic drug production at Kalbe Farma, Tempo Scan Pacific and others is relatively low, said Bahana Securities Head of Research Harry Su.
Shares of Kimia Farma and Indofarma have jumped around 18 percent and 7 percent respectively since the start of the year. The benchmark index has fallen 1 percent. ($1 = 12,190.00 Indonesian rupiah) (Reporting by Fathiyah Dahrul; Writing by Eveline Danubrata; Editing by Christopher Cushing)