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How to Start a Wholesale Pharmacy Business in Indonesia

The pharmaceutical industry in Indonesia has grown significantly over the years with market value expected to reach US$9.9 billion by 2020 – with a compound annual growth rate of 10.2%. This amount is almost doubled as compared to the market value recorded in 2013 (US$5 billion).

The boom of the Indonesia pharmaceutical industry has a lot to do with the increasing life expectancy and the upsurge of governmental healthcare spending.

According to GlobalData, the majority of the market share comes from patented drugs. Also, due to the increasing cases of some communicable diseases, the forecast shows that the therapeutic sector of respiratory and infectious diseases would also grow substantially.

Another sector that sees fast expansion is the generic market thanks to several government incentives and expiry or loss of protection of patented products.

Therefore, it is obvious that starting a wholesale pharmacy business in Indonesia can be a rewarding venture.

However, you should not just go into it blindly. It is going to take a lot of research, determination, and hard work to have a successful business in today’s competitive market.

Cekindo has prepared a powerful guide to get you up to speed.

Restrictions on Pharmaceutical Business in Indonesia for Foreign Investors

In Indonesia under the Negative Investment List, most pharmacy businesses are fully close or only partially open for foreign ownership. However, there is an exception – the wholesale pharmacy business.

The wholesale pharmacy sector is not stated in the Negative Investment List and 100% to foreign ownership is permitted.

Do take note that the wholesale pharmacy sector is not the same as the wholesale drug material sector. Foreigners can not have 100% ownership in the latter sector.

According to the Minister of Health Regulation No. 34/2014 the only allowed legal entity for the wholesale pharmacy category is a limited liability company or a cooperative.

Requirements for Starting a Wholesale Pharmacy Business in Indonesia

To set up a limited liability company or a cooperative in the Indonesia pharmaceutical industry, you need to realise certain requirements:

  • A permanent employee as the pharmacist is mandatory
  • Your business must have an office and storage building for your business activities
  • If your business also sells drug materials, you need to have a laboratory in place to do drug tests and a storage place to keep the materials
  • Compulsory permits to run your business legally are standard trade business license (SIUP), pharmacy distribution certificate and drug distribution method certificate

Procedure for Starting a Wholesale Pharmacy Business in Indonesia

The entire process of the application of pharmacy distribution certificate and drug distribution certificate is performed through the Online Single Submission (OSS) system, the Ministry of Health E-Licensing System, and the Indonesian Food and Drug Authority (BPOM).

Below are some important steps that you must follow to acquire the required certificates to start your wholesale pharmacy business in Indonesia:

1. Prepare a distribution plan.

2. Submit the distribution plan along with the following documents related to the pharmacist in charge:

  • Graduation certificate
  • Identity card
  • STRA – Pharmacist Registration Certificate
  • Cooperation or employment agreement
  • Statement letter showing that the pharmacist is committed to working full-time

3. If the application is approved, the certificates will be issued. If it is rejected, relevant authorities may require you to provide supplementary documents.

How Cekindo can Assist

Cekindo was established with entrepreneurs and businesses of all industries in mind, including Indonesia’s pharmaceutical industry.

We have been continually providing support to companies by offering a variety of business services that you need when setting up your company in this dynamic country.

Serving clients from our global office in Indonesia, Cekindo offers you a truly unique and lightning fast company setup services.

If you need help on your road to business success, get in touch with Cekindo now. We will help fuel your business drive. Fill in the form below.