More and More Korean Pharmaceutical Companies Are Entering the Halal Market

The global Halal market reached US$1.89 trillion in 2015 and is estimated to grow to US$3 trillion within four years. The global Halal pharmaceutical market, which accounted for 6.7% of the global pharmaceutical market two years ago, is expected to reach US$370 billion by 2021 at an average annual growth rate of 9.3%.

In 2014, Dong-A ST established a strategic partnership with the Indonesian pharmaceutical company Combiphar. On August 22 this year, it formed a strategic cooperation with Rooyan Darou for its biopharmaceutical product Growtropin. Under the agreement, the Iranian pharmaceutical company will build a biopharmaceutical production facility in Iran and, starting in 2019, produce and sell Dong-A ST's products. Dong-A ST will collect royalties based on sales.

Iran's pharmaceutical market, with a population of about 79.1 million, is one of the largest markets in the Middle East. The market is expected to grow from US$1.93 billion to US$3.59 billion between 2015 and 2025. The Iranian government is planning to increase the proportion of domestically produced biopharmaceutical products to at least 75% within five years.

Ildong Pharmaceutical's digestive aid Biovita obtained the Korean pharmaceutical industry's first Halal certificate from the Korea Muslim Federation (KMF). Last April, Ildong Pharmaceutical signed a commercial agreement with MS Pharma—a pharmaceutical company headquartered in Jordan—to supply antibiotics and hyaluronic acid antacid products nationwide.

Daewoong Pharmaceutical established a branch in Jakarta in 2005 and in 2012 established PT Daewoong Infion, a joint venture producing biopharmaceutical products. Recently, its anemia drug Epodion was approved last December and began selling in Indonesia this January. 'Epodion is produced and supplied directly in Indonesia, and the Indonesian government is very concerned about this project,' the company explained, adding: 'After this year's sales reach 10 billion won, it is likely to capture 90% of the market share within three years.'

Of course, some Halal-related projects have not worked out well. YuYu Pharma planned to establish a branch in Malaysia and obtained a Halal certificate in 2014, but the project has not yet been implemented. Ildong Pharmaceutical signed a commercial agreement with SPC—a Saudi Arabian company—on the construction of an anticancer drug factory, but the agreement failed at the final stage.