PEZA targets Tarlac and Bulacan for first pharmaceutical zones

The Philippine Economic Zone Authority (PEZA) is set to establish the country's first pharmaceutical zones in Tarlac and Bulacan, following President Ferdinand R. Marcos Jr.'s recent designation of Victoria Industrial Park as a special economic zone. The proclamation of the 29.77-hectare property in Barangay Baculong, Victoria, Tarlac, under Proclamation No. 623, marks a significant step forward for the pharmaceutical industry in the Philippines.

"This is a major milestone in our efforts to develop the first pharmaceutical ecozone during this administration," stated PEZA Director General Tereso O. Panga. "The Victoria Industrial Park is a crucial component of our broader strategy to enhance the pharmaceutical sector, making medicines more affordable and accessible in line with the President’s directives and the efforts of the Office of the Special Assistant to the President for Investment and Economic Affairs (OSAPIEA)."

Aligning with National Development Goals

The establishment of these pharmaceutical zones is part of the Philippine Development Plan 2023-2028, which aims to streamline the drug application process and encourage local producers to boost their research and development (R&D) and manufacturing capabilities. This initiative is expected to lower drug costs and significantly boost the pharmaceutical industry by attracting substantial investments and advancing technological capabilities.

"We are optimistic that this initiative will position the Philippines as a global leader in pharmaceutical manufacturing," Panga added.

Key Developments in Tarlac and Bulacan

The Victoria Industrial Park in Tarlac is set to accommodate various players in the pharmaceutical industry, promoting diversification and encouraging the creation of additional pharma zones nationwide. FDA Director-General Samuel A. Zacate has already indicated plans to establish an FDA laboratory in Tarlac to support this initiative.

In Bulacan, the PEZA-registered First Bulacan Business Park (FBBP) is expected to host medical R&D for the production of innovative drugs, medical instruments, and pharmaceutical cold chain logistics. FBBP is located near the First Bulacan Industrial City (FBIC), also known as the Pharma City of the North, which houses eight pharmaceutical firms, including Lloyd Laboratories and Pascual Laboratories.

PEZA’s Ongoing Efforts

As of December 2023, PEZA hosts 27 companies engaged in pharmaceutical and medical device manufacturing, generating investments of PHP 25.525 billion and creating over 19,000 direct jobs. In Tarlac alone, 19 companies have generated US$161.067 million in exports and over 18,000 jobs, while Bulacan hosts seven PEZA-registered enterprises, contributing US$89.973 million in exports and creating more than 11,000 jobs.

Partnership with FDA

PEZA, in cooperation with the OSAPIEA, is working with the FDA to develop guidelines for registering pharmaceutical ecozones and improving the regulatory environment for PEZA-registered businesses. These guidelines will govern the establishment and operation of pharma zones, outlining qualifications, processes, and activities eligible for fiscal and non-fiscal incentives.

"We are currently refining the draft guidelines with input from relevant national agencies and industry stakeholders," Panga explained. "The finalization will consolidate and harmonize feedback to ensure a robust regulatory framework."

PEZA is also revisiting a decade-old memorandum of agreement (MOA) with the FDA to streamline the approval process for permits, licenses, and certifications, thereby attracting more pharma-related investments.

Industry Engagement

PEZA is actively engaging with industry stakeholders, including the Philippine Chamber of the Pharmaceutical Industry Inc. (PCPI) and the Pharmaceutical and Healthcare Association of the Philippines (PHAP), to understand the needs of the sector and promote self-sufficiency in pharmaceutical manufacturing. Recent dialogues have also included discussions with Royal Cargo and Royale Life Pharma.

A joint briefing by the Anti-Red Tape Authority (ARTA), Department of Health (DOH), FDA, and PEZA was held on July 1, 2024, to discuss initiatives and advancements in the medical drug and device manufacturing sector.

Future Outlook

Director General Panga emphasized that the establishment of pharmaceutical ecozones is part of a comprehensive government and industry approach to create a thriving business environment. "As the Philippines becomes a manufacturing hub in Southeast Asia for high-quality medicines, we will see increased availability and lower prices for the Filipino people," Panga concluded. "This initiative will not only benefit the local population but also position the country as a key player in the global pharmaceutical industry."