Taiwan’s pharmaceutical market will expand in value from $5.4 billion in 2013 to reach approximately $8.4 billion by 2020, despite the ongoing political tensions with China presenting an obstacle to economic development.
Reportstack’s latest report "CountryFocus: Healthcare, Regulatory and Reimbursement Landscape - Republic of China (Taiwan)" states that diplomatic isolation, high out-of-pocket expenditure and the inefficient distribution of healthcare facilities are the foremost challenges to Taiwan’s pharmaceutical sector.
According to Joshua Owide, GlobalData’s Director of Healthcare Industry Dynamics, the diplomatic situation with China came further under the spotlight following the results of local elections in November 2014.
“The trade agreement with China in June 2013 has had a negative effect on President Ma Ying-Jeou’s popularity, as many people in Taiwan fear it is a step towards reunification with China, and some believe that the free trade pacts will destroy local small businesses.
“The November 2014 local elections saw the ruling Nationalist Party, Kuomintang, win just six of the 22 contested seats, which many commentators attributed to its pro-China policies. With a general election scheduled for January 2016, the result could further impact trade opportunities for a country that only has formal diplomatic ties with 24 countries in Pacific, Latin American and African states.”
Despite these reservations, Taiwan’s pharmaceutical outlook remains positive, with opportunities presented by a free trade agreement with the US, low-taxation investment environment, harmonized clinical trial process, an efficient patent system, and strong incentives for Research and Development (R&D).
“Taiwan has signed a free trade agreement with the US, which is expected to positively impact the market, while government incentives, such as low taxation, make Taiwan a lucrative place for foreign investment.
“Biotechnology and pharmaceutical companies receive deductions from income tax liability for undertaking R&D into new drugs and high-risk medical devices, among other tax incentives, further boosting market growth.”
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