GSK eyes up to 35 percent growth in RI market

JAKARTA. With its new products, global consumer healthcare manufacturer GlaxoSmithKline (GSK) is upbeat that the company’s annual sales growth can reach more than 30 percent in the growing Indonesian healthcare market over the coming years.

GSK Indonesia consumer healthcare general manager Pawan Sud said in Jakarta on Tuesday that beginning this year, the company’s compound annual growth rate (CAGR) in total revenues could reach between 30 and 35 percent, because of the introduction of new healthcare products.

Sud said the consumer healthcare division of GSK Indonesia, part of the UK-based GSK, had posted a 23 percent CAGR in the past five years, outgrowing the range of 11 and 12 percent growth of Indonesia’s fast-moving consumer goods (FMCG) industry.

To accelerate the percentage of growth, GSK Indonesia’s health division will implement new innovations and introduce several GSK products that are already marketed globally in Indonesia.

Some GSK global brands that will be brought to Indonesia are nutritional drink Horlicks, antacid powder Eno and several topical balms produced by the manufacturer.

“Depending on the regulatory approval and the condition of our supply chain mechanism, we plan to launch our other brands in the wellness and nutrition portfolios,” he said.

With the sales of new products, he believed the sales target could be achieved.

Sud said Indonesia’s healthcare market was very promising because of the country’s large middle class that was expected to grow to 125 million people in 10 years from the current 55 million.

According to Sud, Sensodyne — as one of the division’s biggest portfolios — has huge scope to grow in the future, even though the percentage of the brand’s market share is still at “single digit”

Globally, Sud said Indonesia was one of six strategic markets for GSK’s consumer healthcare business besides India, China, the US, Brazil and Nigeria.

Sud added that GSK’s consumer health care posted around US$8 billion in sales turnover in 2013,
with about 40 percent of the amount from outside the US and Europe.

In March last year, the Singapore-based GSK Consumer Healthcare Pte. Ltd. acquired 30 percent shares worth Rp 465 billion (US$ 37.2 million) to fully own the Indonesian GSK consumer healthcare business, which was previously owned by Sarasvati Venture Capital Ltd (SVC).

GSK has also divested its Insto eye drops brand to Pharma Healthcare Pte. Ltd. and agreed to divest its manufacturing site at Bogor, West Java to Indonesia-based PT Pharma Healthcare for a combined total of Rp 133 billion.

The Bogor facility will be transferred to Pharma Healthcare in 2015.

According to the company’s plan, GSK will continue to sell the same formulation of eye drops under the brand Eyemo across a number of other emerging markets, which are unaffected by the transaction.

Sud said around 50 percent of all GSK’s products sold in the local market were manufactured in Indonesia — Bogor and Pulo Gadung, Jakarta. (Grace D. Amianti)