The Philippines pharmaceutical market is projected to rise moderately from $3.4bn in 2015 to $4.1bn by 2020 at a compound annual growth rate of 3.7%, according to a new report by GlobalData.

Titled 'CountryFocus: Healthcare, Regulatory and Reimbursement Landscape – Philippines', the report states that a number of initiatives taken by the government are helping the healthcare market to grow.

The Filipino government is increasingly supporting generic substitution in the public and private sectors. It is also implementing strong patent and trademark laws to protect innovation and boost foreign investment in the industry.

The Philippines pharmaceutical market is the third biggest in the Association of Southeast Nations and is dominated by generic drugs, which generated 65% of the revenues in 2014, whereas patented drugs accounted for 35%.

"Various initiatives taken by the Filipino government are aiding in the growth of the sector, such as the government allocating $2.8bn to the Department of Health in 2016."

Various initiatives taken by the Filipino government are aiding in the growth of the sector, such as the government allocating $2.8bn to the Department of Health in 2016.

It has also established village Botika ng Barangays (BnBs), which are government-licensed, privately owned and operated pharmacies that provide access to healthcare for people in rural areas. The number of BnBs established in 2010 was 2,000, which increased to more than 7,700 by 2014.

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Furthermore, the Philippines’ open economic system provides significant investment opportunities, the report adds.

The Filipino government supports a build-operate-transfer (BOT) investment scheme enabling 100% foreign ownership in a number of sectors. The operational costs are also lower, with communication, electricity and housing costs being 50% lower compared to those in the US.

The report also states that the Philippines is emerging as an attractive destination for global clinical trials. The country registered a 31% increase in the number of clinical trials in 2009, which is the eighth-highest annual growth rate worldwide.

These factors and a $22.6m investment in research and development in 2013 have led to the growth of the healthcare sector.