Indonesian drugmaker Kalbe Farma signs a joint venture with Fillipino consumer goods distributor Ecossential Foods on May 18 in Manila, the Phillipines ((Photo: kalbe.co.id)

Jakarta – Indonesian top drugmaker Kalbe Farma has announced the founding of a joint venture in the Philippines as the company plans to expand its operation across Southeast Asia.

Kalbe, through its subsidiary Kalbe International, will control 60 percent of Kalbe Ecossential International while Philippine consumer goods distributor Ecossential Foods will hold the rest.

The joint venture is expected to help increase Kalbe's sales of its nutrition products in the Philippines before introducing others such as prescription and over-the-counter drugs, as well as herbal medicines in Southeast Asia's second most populous nation after Indonesia.

Vidjongtius, president director of Kalbe Farma, said the Ecossential partnership is a "first step" as the Indonesian corporation looks to collaborate with other local partners to further expand across the region.

Apart from exporting to half of the 10 members of the Association of Southeast Asian Nations (ASEAN), Kalbe runs a factory in Myanmar. However, Indonesia remains its largest market, with exports accounting for 5 percent of the total sales. Vidjongtius said the company hopes to increase the export share to 10 percent over the next several years.

He affirmed ASEAN with its more than 600 million people will be Kalbe's next focus for further expansion, adding that Kalbe is also eyeing the Middle East and some African markets.

According to Vidjongtius, rising oil prices alone are already fueling cost hikes for some raw materials used in local drug manufacturing. Indonesia sources most of its raw materials for drugs from imports, mainly from China and India.