Indonesia Prescription Drugs Market Outlook to 2030

Indonesia Prescription Drugs Market Overview

• The Indonesia Prescription Drugs market is valued at 1.5 billion, has seen growth over recent years, driven by an increase in health awareness, government initiatives, and expanding access to healthcare services. This growth can be attributed to Indonesias expanding healthcare system, including the implementation of the National Health Insurance program (JKN), which covers over 80% of the population, driving demand for essential and prescription medicines.

• Major cities such as Jakarta, Surabaya, and Bandung dominate the prescription drugs market due to their high population density, improved healthcare infrastructure, and concentration of medical facilities. These cities serve as central hubs for both domestic and international pharmaceutical companies.
• In 2024, the Indonesian government has further expanded the scope of the Jaminan Kesehatan Nasional (JKN) program, covering an additional 10 million people, bringing the total number of insured individuals to over 223 million. This expansion facilitates greater access to prescription drugs by subsidizing medication costs for lower-income families, which will drive up prescription drug sales, especially for chronic and essential medications.

Indonesia Prescription Drugs Market Segmentation

By Molecule Type: The market is segmented by molecule type into small molecule drugs and biologics & biosimilars. Currently, small molecule drugs hold the dominant market share due to their established presence in treating common illnesses such as cardiovascular and respiratory diseases. They are easier to manufacture, store, and distribute across Indonesias wide geographic spread, making them accessible to a large segment of the population.

By Formulation Type: The market is segmented by formulation into tablets, capsules, injectables, sprays, and suspensions. Tablets dominate the formulation segment, holding the largest market share. This is due to the ease of consumption, storage, and widespread familiarity among patients and healthcare providers. Additionally, tablets are a cost-effective option, which aligns with the countrys goal of making affordable medication available to a majority of its population through the National Health Insurance program.

Indonesia Prescription Drugs Market Competitive Landscape

The market is characterized by a mixture of domestic and international players. Local manufacturers such as Kalbe Farma and Bio Farma dominate the market with a strong focus on generic drugs, which constitute a significant portion of the total pharmaceutical sales.

Indonesia Prescription Drugs Market Analysis

Market Growth Drivers

• Rising Demand for Chronic Disease Management: Indonesia is experiencing a growing number of patients with chronic diseases, including diabetes and cardiovascular illnesses, which require long-term medication. According to the Ministry of Health of Indonesia, the number of individuals diagnosed with diabetes reached over 11 million in 2023, leading to an increased demand for prescription drugs like insulin and oral anti-diabetic medications.
• Expanding Healthcare Access in Rural Areas: In 2024, the Indonesian government has expanded healthcare services to rural and underserved regions, increasing the accessibility of prescription drugs. This expansion includes the construction of 50 new primary healthcare centers (Puskesmas) by the end of 2023 and the deployment of mobile healthcare units across remote islands.
• Aging Population Leading to Higher Medication Needs: Indonesia's aging population is growing rapidly, with 36 million individuals aged 60 and above in 2024, according to the National Statistics Agency. As elderly individuals are prone to conditions such as hypertension, arthritis, and respiratory diseases, the need for geriatric-specific prescription drugs is expanding.

Market Challenges

• Regulatory Hurdles in Drug Approvals: The Indonesian Food and Drug Authority (BPOM) has stringent regulations that can delay the approval of new drugs. The average time for obtaining approval for new prescription medications has increased to 24 months in 2024, slowing down the introduction of innovative drugs into the market.
• Counterfeit Prescription Drugs: The circulation of counterfeit prescription drugs continues to be a challenge in Indonesia, with over 1.8 million counterfeit drug units seized in 2023 by the BPOM. This issue undermines patient safety and trust in prescription medications.

Indonesia Prescription Drugs Market Future Outlook

Over the next five years, the Indonesia Prescription Drugs industry is poised for growth, driven by the continued expansion of the National Health Insurance program, rising healthcare expenditure, and increasing prevalence of non-communicable diseases such as diabetes and cardiovascular conditions.

Future Market Opportunities

• Expansion of Local API Production: Over the next five years, Indonesias API production capabilities are expected to increase significantly. By 2029, local manufacturers are projected to supply over 50% of the countrys API demand, reducing import dependency and stabilizing the local prescription drug market.
• Growth in Geriatric Medications: By 2029, the demand for geriatric medications is forecast to rise sharply due to the expanding elderly population, which is projected to reach 42 million. Prescription medications for age-related diseases such as hypertension, arthritis, and Alzheimers are expected to witness a substantial uptick.