NEVER being content with past achievements is the key to Duopharma Biotech Bhd's success.
Cheah Ting Poh, managing director and co-founder of the pharmaceutical company, has the constant urge to look for new products.
“We have to be leading the trend instead of following it,'' he said in an interview with StarBiz.
Cheah's strategy is to seize opportunities to pioneer the latest technology and produce cheaper alternatives to serve the mass market.
Roughly 10 years ago, Duopharma ventured into injectables - a form of medication that takes effect faster than the oral forms such as capsules or tablets.
The company was then the only local pharmaceutical firm that manufactured small volume injectables (SVI).
At that time, the local hospitals were relying solely on imported injectable products from the large multinational drug makers.
Duopharma's decision to undertake the risk by becoming a pioneer proved spot on.In 1995 the company secured a contract to supply injectable items to public hospitals because the locally made products suited the government's policy that stressed cost-effectiveness.
Duopharma currently commands the lion's share among local drug makers in the SVI market.
It is supplying 90 items to the government hospitals via Remedi Pharmaceuticals (M) Sdn Bhd, a subsidiary of Pharmaniaga Bhd.
Government hospitals and doctors are its principal clients, accounting for about 40% of the company's revenue.
Duopharma now plans to venture into the production of liquid capsules - capsules that contain medicine in liquid form. This is the latest technology that originated from France.
“The concept is similar to injectables which give faster relief and immediate effects to patients,'' Cheah explained.
According to Cheah, no local pharmaceutical firm is participating in this segment currently.
Hence, the success of this project will mean another breakthrough for Duopharma after its SVI venture.
Cheah and his management team have travelled overseas to look for machinery to produce liquid capsules. “Production is expected to commence soon,'' he said.
Meanwhile, Duopharma has a drug for kidney patients, Erythropoietin, being tested to meet the Health Ministry's standards.
The production of these drugs at more affordable prices will give a boost to Duopharma's earnings as the existing market is now dominated by the multinational drug makers.
The lucrative government contracts do not stop the company from seeking new income sources because Cheah understands the risk of putting all its eggs in one basket.
To reduce the dependence on certain clients, Duopharma has already made plans to enter new markets and diversify its product portfolio.
Last month, the company signed a memorandum of understanding with the Department of Health of Papua New Guinea (PNG) to supply medicines to the country through government tender procedures.
It is also considering the setting up of manufacturing facilities in PNG if the environment there is conducive. At present, Duopharma exports to Asean countries and the Middle East.
Besides penetrating new export markets, the company is gearing up to expand its over-the-counter (OTC) drug division, which currently contributes little to its earnings.
“There is a large potential in the OTC market as Malaysians are getting more health conscious,” said Cheah.
Duopharma specialises in ethical drugs so, in his view, it is serving only a portion of the potential market – i.e. the sick population.
“But the OTC products, for example, health supplements, will allow us to tap the entire population in the country, not only those who are sick,'' he added.
OTC products, which are also known as non-prescription medicine, are generally for treatment of simple ailments such as flu and cold. It includes vitamins and food supplements.
Duopharma already has five registered OTC products and will be launching another five soon.
Cheah said the profit margin of OTC products was better than that of ethical drugs, which had a shorter shelf life.
Duopharma is expanding its production capacity by building a second plant in Klang to cater to its future plans.
The new factory will be solely for SVI products while the existing plant will be used for other products, including liquid capsules.
Cheah said the spare production capacity would enable Duopharma to be more active in the bio-pharmaceutical segment, i.e. to produce drugs or health supplements generically from herbal plants.
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