Business Development Asia LLC

South East Asian Health News

ISSUE 6, APRIL 1998

MALAYSIA

Chief Minister Inc. (CMI), a Malacca State Government company, acquired a majority stake in Southern Hospital. CMI paid RM20m (US$5m) for 60% of the hospital. The other shareholders are Apex Pharmacy (5%), Mediquest (15%) and United Medicorp (20%). The hospital has two branches, one in Jalan Bendahara, Malacca, and the other in Batu Pahat, Johor. The State Government hopes to list the hospital on the Kuala Lumpur Stock Exchange and has plans to set up hospital branches in other countries in the region. (March 9^th 1998)

Eu Yan Sang, a prominent traditional Chinese herb and medicine manufacturer and retailer, expects to increase exports from 20% to 50% following the opening of its RM6m (US$2m) factory in Cheras, south of Kuala Lumpur. Eu Yan Sang currently exports its products to several Southeast Asian countries as well as Australia, Hong Kong, North America, and the U.K. Weng Li Sdn Bhd, a manufacturing subsidiary of the Eu Yan Sang Group, will manage the Good Manufacturing Practice (GMP) factory. (March 18^th 1998)

Hospital Pantai Bhd (HPB) has aborted its plans to transform the group’s core business activities into financial services. HPB cancelled its plans to sell its healthcare assets and business to Tongkah Holding Bhd and to acquire a majority stake in two finance companies. (April 2^nd 1998)

The Malaysian Organization of Pharmaceutical Industries (MOPI) has announced that it expects the local pharmaceutical manufacturing industry’s revenues to increase by 15% in 1998 to RM345m (US$96m). The local pharmaceutical market is expanding as physicians, hospitals and clinics are using locally-manufactured medicines as a low cost alternative to imports. It is expected that local manufacturers will take advantage of the weakened ringgit by increasing exports to Africa and South America. (April 10^th 1998)

The Pharmaceutical Association of Malaysia (PhAMA) has urged the Malaysian Industrial Development Authority (MIDA) and Ministry of International Trade and Industry (MITI) to encourage the establishment of contract manufacturing by Western pharmaceutical firms. PhAMA maintains that contract manufacturing would benefit Malaysia because domestic production would lower prices on previously imported drugs. PhAMA argues that Western companies could also use Malaysia as an export base. (March 2^nd 1998)

Pfizer Malaysia Sdn Bhd has announced that it expects revenues to grow by 20% in 1998 to RM40m (US$11m). Pfizer expects the pharmaceutical industry as a whole to experience 10% growth in Malaysia in 1998. Pfizer has made substantial investments in information technology in order to improve the quality of health services for both providers and users. The company has launched the Electronic Business Management System (EBMS) which will link Pfizer to the medical community in Malaysia and the Health Ministry, once the Ministry’s system is ready. (April 10^th 1998)

Ramgate Systems, the IT unit of DRB-Hicom Group, has been awarded an estimated RM1m (US$250,000) contract to supply, install and commission the Maternal and Child Healthcare System (MCH). The MCH system will link together nine Government clinics with the State Health Department in an attempt to provide more effective pre- and post-natal care. (March 9^th 1998)

The Sarawak Biotechnology Park project, a RM30m (US$7.3m) undertaking, will be privatized in an effort to obtain funding. The park will focus on the research and development activities for the pharmaceutical industry. The Government announced that it intends to offer incentives to foreign companies to set up operations in the Park. (March 25^th 1998)

Sa Sa International Holdings Ltd., the Hong Kong-based cosmetics retailer, will expand its investment in Malaysia. Sa Sa recently opened a flagship outlet store in Kuala Lumpur and is expected to continue to increase its presence in Malaysia. The company currently has 22 regional outlets but plans to increase this number to 40 by the end of the year. Most of the planned expansion is to come in Taiwan, Singapore, and Hong Kong, with two outlets opening in Malaysia. (March 28^th 1998)

Southern Health Sdn Bhd, the Malaysian based healthcare investment group, and Viragen Inc, a US-based biopharmaceutical company, have executed a licensing option worth US$20m. Southern will acquire an exclusive private-label manufacturing and distribution license for Viragen’s production process for natural interferon. In addition to the US$20m licensing fee, Southern will pay Viragen a 12% royalty on all future interferon revenues. Southern will gain exclusive rights to manufacture and distribute Viragen’s interferon products in Australia, New Zealand and South East Asia. The territory excludes China and Japan. (April 7^th 1998.