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Singapore gets shot in the arm from global drug demand
SINGAPORE, Dec 20, 2020 (BSS/AFP) – Scientists in protective clothing work
in a high-tech laboratory at a pharmaceutical plant in Singapore, whose
coronavirus-hit economy has received a shot in the arm from robust global
drug demand.
The city-state is on course for its worst ever recession this year but
factory activity has held up, thanks partly to countries rushing to stockpile
medicines during the pandemic.
The nation just half the size of Los Angeles has become a centre for drug
makers and is home to more than 50 factories, owned by big players including
Pfizer, Roche, GlaxoSmithKline and Takeda.
Singapore’s drug sector “plays an important role in the global
pharmaceutical industry supply chain”, Rajiv Biswas, Asia Pacific chief
economist at consultancy IHS Markit, told AFP.
And in 2020, “governments and private-sector firms have been building up
inventories of critical drugs as a result of the severe supply chain
disruptions in many countries during the pandemic”, he added.
Data highlights the benefits for the trading hub — biomedical
manufacturing, which covers pharmaceuticals, has grown strongly, with output
expanding 90 percent on-year in September alone.
Exports also defied expectations of a collapse and posted growth most of
the year, helped by drug shipments, although they slipped back in October and
November.
While much attention has focused on vaccine development, strong demand for
medicines to treat illnesses ranging from asthma to epilepsy has underpinned
the continued good fortunes of the pharmaceutical giants in the city,
industry players and analysts say.
It is a much-needed boost after Singapore’s economy shrank more than 13
percent in the second quarter when the country introduced tough virus curbs.
With borders largely closed, the key tourism sector has been particularly
hard-hit with arrivals falling to just 13,400 in October from 1.7 million in
January.
Singapore’s outbreak has been relatively mild, however, with the city-state
recording around 58,000 cases and 29 deaths, while the economy began
recovering in July-September as restrictions were eased.
The city had long been a major exporter of electronics, from microchips to
computer hard disks, but has sought to diversify its manufacturing sector.
– Uneven recovery –
The biomedical industry — which also covers making high-tech medical
devices such as pacemakers — now employs more than 24,000 people and
accounts for about 20 percent of the manufacturing sector, according to risk
consultancy Fitch Solutions.
Singapore, with a population of 5.7 million, is one of the few countries
that exports more pharmaceuticals than it imports — in 2019 it shipped
pharma products worth US$8.1 billion while importing US$3.1 billion-worth,
according to Fitch.
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Authorities have promoted cutting-edge research to grow the economy,
committing to invest nearly US$20 billion in research and innovation for the
next five years.
Amid a network of stainless steel pipes and storage tanks, Takeda’s
facility grows cells from hamster ovaries to make ingredients for drugs to
treat haemophilia, a rare disorder that affects the blood’s ability to clot.
The final product is flown to Switzerland, Vienna or California where it is
mixed with other ingredients and put in vials, before being sent to Belgium
for packing and then shipped worldwide.
“Overall, the pharma industry in Singapore has not been adversely impacted
by the pandemic,” George Lam, who heads the company’s Singapore manufacturing
site, told AFP during a visit.
“Because we are not affected we continue to manufacture, we continue to
export our drugs to the global markets… A number of pharma companies in
Singapore are doing life-saving medicines.”
It has not been all smooth sailing for the company’s Singapore operation.
Some of its workers got stranded in neighbouring Malaysia when borders were
closed, although the site managed to continue operating.
The health of Singapore’s drug sector is a rare bright spot for the city’s
economy, and also for trade worldwide.
The value of global trade is set to fall by up to nine percent on-year in
2020, the United Nations has forecast, and leaders in the export-dependent
city-state remain nervous about the outlook.
“We expect recovery next year to be gradual and uneven because of recurrent
waves of infection in other countries, and the uncertainties associated with
the pace of vaccine production, distribution and vaccination,” said Trade
Minister Chan Chun Sing.
“We will not return to the pre-Covid world.”
BSS/AFP/MSY/0956 hrs