How to leverage the pharmaceutical industry in Malaysia & ship abroad

The pharmaceutical industry in Malaysia is one of the biggest in South-East Asia. It was valued at US$2.9 billion in 2020 and has grown since, reports Malaysia’s Investment Development Authority (MIDA). The major market players in the industry are constantly innovating and evolving products for retail, making Malaysia a force to be reckoned with in the global pharmaceutical market.

The industry uses a supply chain management system to guide medical drugs from production to retail and can be split into four categories of products. As always, exporting goods overseas is not as easy as it may seem. There are a couple of rules, regulations, and permits to take note of when shipping products from the pharma sector. 

This article aims to break down the four categories in the Malaysian pharmaceutical industry, explain the demand for medical products in other countries, and highlight any shipping regulations and permits needed to export medical drugs from Malaysia.

The four types of pharmaceutical products in Malaysia

The pharmaceutical industry in Malaysia can be broadly categorised into four sectors, namely, prescription medication, over-the-counter (OTC) products, traditional medicines, and food or health supplements. Malaysia has a unique market in the sense that the Malaysian demographic represents a modern yet traditional outlook on medicine. That is to say, while prescription drugs and OTC products are highly in demand, traditional medication and herbal medicine are also used in conjunction as both a deterrence and cure to illnesses.

In 2020, Malaysia’s government reported that 2,600 community pharmacies exist across the nation, comprising over 1,000 retail pharmacy brands. These pharmacies would mostly be selling OTC products and prescription medicines. On the other hand, in 2018, there were 16,162 individual Traditional Chinese Medicine (TCM) practitioners in the country, recorded by Malaysia's Ministry of Health (MOH). These practitioners specialise in traditional medication, herbal and health supplements for consumption. Both types of retail medication specialists are used in tandem and hence present a unique opportunity to the rest of the world in export due to the diversity of the pharmaceutical industry in Malaysia.

The regional and global demand for the Malaysian pharma sector

The consistent investments from the Malaysian government into its pharmaceutical industry have ensured its steady growth over the years, making it a medical destination and a highly demanded medical product pioneer in South-East Asia. Malaysia’s large Muslim population has also made the country a key player in the Halal pharmaceutical manufacturing industry. This represents a niche opportunity for businesses wanting to export prescription drugs and the like to other countries. By doing so, they can address, among other factors, the rising need for medication, increased adoption of herbal solutions as well as the growing demand for health supplements worldwide.

Muslim-dominated countries with smaller scales of pharmaceutical production could then be targeted as key export destinations for Halal medical products. As the Malaysian government keeps investing in its pharma sector, now could be the time to start an export business for Malaysian medical products that spans countries with a large Muslim population, as well as, countries with a history of using herbal and health supplements such as China, Japan, or South Korea.

Regulations for shipping pharmaceuticals and restricted drugs in Malaysia

Shipping documents

The export of drugs and chemicals is restricted in Malaysia. Alongside your standard export documents like your Certificate of Origin, Commercial invoice, and Bill of Lading, one must apply for a Type A or B Licence to import or export chemicals before being able to get through customs clearance in Malaysia. This process can be done online via ePermit to ensure your qualification as a dangerous chemicals exporter. 

Without a permit or licence issued by MOH, your shipments would be seized by customs authorities.

Taxes

While exportation of goods out of Malaysia does not entail any duties and taxes, you will have to pay the import equivalent in the destination country you ship to, depending on the legislation’s specific rules. 

Packaging

Special measures must be taken to ensure the safe and proper shipping of pharmaceuticals. This includes technology that controls the temperature of the products and special packaging material that provides insulation. Working with an international logistics carrier that specialises in express medical shipping can help ensure your pharmaceutical products travel through the supply chain in optimal condition to protect their integrity and therefore, consumer safety. 

Insurance

Insuring your packages is also an important part of the shipping process. Shipment insurance is designed to provide your medical products with financial protection when they move along the supply chain. In the event of physical damage or loss, you can claim the necessary amount to facilitate the reproduction of medicines and refund affected customers. 

Learn more about exporting goods out of Malaysia and be well-informed about all that is to prepare before you ship medical drugs abroad.