PEZA supports creation of pharma ecozones | Department of Trade and Industry Philippines

PASAY CITY – Guided by His Excellency President Ferdinand R. Marcos Jr.’s earlier pronouncement on the importance of ecozones as a tool for socioeconomic growth and development, Philippine Economic Zone Authority (PEZA) Director General Tereso O. Panga is positive that there will be an increase in medical and drug manufacturing-related investments with the creation of pharmaceutical economic zones in the Philippines.

During a sectoral meeting with the Food and Drug Administration (FDA) last Tuesday, 13 February 2024, President Marcos Jr. floated the idea of establishing pharma-zones which will serve as one-stop shops to make the drug application process more accessible and efficient.

FDA Director General Samuel Zacate stated that pharma-zones established in PEZA-controlled areas will serve as places where the agency can immediately test and register medicines upon entry to the Philippines.

“We are excited and more than encouraged to be facilitating the establishment of pharma ecozones in the Philippines which will become instrumental in the Administration’s efforts to enhance accessibility to medicines and lower drug prices,” said DG Panga.

Pharma Ecozone

Under the Philippine Development Plan 2023-2028, PEZA is tasked to accelerate the implementation of the ecozone transformation roadmap through the creation of different types of economic zones, including pharmaceutical ecozones. Pharma-zones shall become home to companies engaged in all aspects of medical and drug manufacturing-related activities, most especially in research and development (R&D), clinical testing and trials.

“We are coordinating with the Department of Health (DOH), FDA, DTI and the Philippine Chamber of Pharmaceutical Industries (PCPI) in crafting the guidelines for the registration of pharma zones under PEZA in line with this mandate,” stated the PEZA Chief.

Earlier, PEZA entered into a Memorandum of Agreement with the FDA to streamline the applications for permits and licenses to operate for RBEs engaged in the manufacture of food, cosmetic and drug products, including medical devices, and to ensure compliance of ecozone locators to all provisions of the Food and Drug Act of 2009 and other pertinent laws.

There were also talks in 2017 between the Philippine and the Indian Governments to set up manufacturing zones in the country for Indian pharmaceutical companies wanting to tap the ASEAN market. Likewise, in 2021, PEZA conducted a briefing for the Pakistan Pharmaceutical Manufacturers Association given its interest to set up drug manufacturing operations in the Philippines to address the growing local demand for generic medicines.

DG Panga noted, “These pharma ecozones will in the future boost local supply as well as provide business and capability building opportunities particularly for Filipino SMEs into manufacturing and tolling of drugs and food supplements. We can contribute to the DTI’s science, technology and innovation-driven industrialization strategy through the pharma zones that will seek to strengthen partnerships between global drug manufacturing companies and the local industry players with their integration into the ecozone and global value chains.”

Under the CREATE Law, domestic market-oriented enterprises to be registered in PEZA and other IPAs are granted fiscal incentives depending on their location and activity. For health-related activities like manufacturing of drugs and medical R&D, they may enjoy up to 12 years of tax perks.

Pharma-related investments

As of December 2023, PEZA hosts a total of 26 operating companies into the manufacture of pharmaceutical products and medical equipment or devices like Terumo, Arkray Industry, Royale Life Pharma, JMS Healthcare and Philipcare Medical, generating about P25.489 billion of investments and more than 19,000 direct jobs for the country. Moreover, PEZA is reviving talks with the leading Filipino companies into pharmaceutical-related activities such as Lloyd Laboratories, Pascual Laboratories and United Laboratories, Inc., for the establishment of a modern pharma park in the country.

It is also worth mentioning that in 2021, Malacañang proclaimed PEZA-registered First Bulacan Business Park (FBBP), which is seen to host medical R&D for the manufacturing of innovative, over-the-counter and generic drug products, medical instruments/equipment, and pharma cold chain. FBBP is adjacent to the First Bulacan Industrial City (FBIC) or the Pharma City of the North, which is home to eight (8) pharma-related firms including Lloyd Laboratories, Pascual Laboratories, Lumar Pharmaceutical, Cargill Phils. and Cosmetique Asia.

“In all these, we hope to see the pharma parks creating a platform for increased R&D, technology transfer, registration of local patents, and a complete ecosystem that will enable the country to produce its own medicines and provide access to quality, affordable medicines, medical products and healthcare for all Filipinos,” DG Panga expressed. ♦

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