Sustainable Growth in Pharmaceutical Manufacturing Firms of Thailand

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Sivavut Kharop
Watcharee Khunkitti
Norapol Chinuntdej

Abstract

This article focuses on the factors that affect sustainable competitive advantage and sustainable growth of business organizations in the pharmaceutical manufacturing industry of Thailand in order to propose guidelines to build a model for sustainable growth. By studying the form and nature of business of Thai pharmaceutical manufacturing firms and reviewing the relevant theories and concepts on the development of pharmaceutical industry in Thailand, we identified three key factors that contributed to sustainable growth. These were the national drug policy, the national strategic drug development plan and the national economic and social development plan. The Thai pharmaceutical industry is important to public health, stability and the country's economy, both in normal conditions and in emergencies. Unfortunately, only five percent of pharmaceutical entrepreneurs are stable in the industry. The firms with the highest income in the industry are usually joint ventures of Thai and foreign shareholders. In general conditions, the current situation and trends of the industry appears to have the lowest potential among the whole health industry. Of all Thai manufacturers, only five are able to produce active pharmaceutical ingredients. However, they only produce old drug raw materials that do not require advanced technology for production. Approximately 90 percent of ingredients are imported from foreign countries. As a result, the country is unable sustain itself and provide stability in medicine, especially in emergencies such as the Covid-19 pandemic situation and at war. Therefore, applying concepts and theories related to sustainable growth, such as  the triple value chain and the triple bottom line that measure the impact of organizational activities, could be one approach to improve sustainability in this field. These impacts may be reflected in value added to the firms in terms of profits as well as the value of the equity capital of society and the environment. In conclusion, sustainable growth in pharmaceutical manufacturing firms of Thailand can be measured with three main parameters: economic performance, social performance and environmental performance , which can be used as a basis to create a model for sustainable growth in the future.

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