Little-known Bio Farma fighting disease globally

Little-known Bio Farma fighting disease globally

Bio Farma was little known to the public until it recently
gained international press attention following a decision by
Nigeria to buy polio vaccine from the firm.

The Bandung-based firm, which was established as the Pasteur
Institute by the Dutch colonial government in 1890, is going to
celebrate its 114th anniversary on Aug. 6.

While keeping a low profile, the state-owned firm has been
apparently making handsome money. Its sales stood at Rp 62.43
billion in 1995. Five years later, the sales rose six-fold to Rp
362.87 billion and further grew to Rp 509 billion in 2003.

Zakki P. Hakim of The Jakarta Post spoke with Bio Farma
president Marzuki Abdullah on its deal with Nigeria and its
business outlook.

The following is an excerpt of the interview:

Question: Why did the Nigerian government decide to procure polio
vaccine from Bio Farma?
Answer: Last year, one of Nigeria's Muslim states, Kano, halted
its vaccination program after the local authorities alleged the
vaccine had been contaminated with hormones that could make girls
infertile. They suspended the use of oral polio vaccine (OPV) and
formed several expert committees to do their own tests and to
look for a new source of safe drugs. Eventually, they came to
Indonesia, which is one of the five countries certified by the UN
authorities as a producer of safe vaccines.

What brought them to Indonesia?

Nigeria is a Muslim country. So apparently they were interested
to see Indonesia as the most populous Muslim country in the
world, which is also producing polio vaccine. In April, a
delegation of 26 scientists, Muslim clerics and academics visited
our site in Bandung. They said that they were looking for
vaccines that were not contaminated with substances that could
make girls sterile.

Did you use any special approach to convince them?
We used a socio-political approach by emphasizing that as Muslims
we would not harm our fellow Muslims. They saw us using similar
greetings and prayers as theirs. At one meeting with the
delegation, a Nigerian TV recorded us reciting Al-Fathihah, the
first verse in the Al-Qur'an, before we started our discussion.
Eventually, they were convinced and said that they were satisfied
to find a country where the majority of people were Muslims that
produces polio vaccine.
One month later, we received OPV orders from the United Nations
Children's Fund (Unicef) for Nigeria. The initial order was 2.865
million vials of OPV worth US$2.36 million. By June, we had
shipped 1.915 million vials.

Do you see such a sentiment in other countries that you might use
as an opportunity?
I have heard that some Muslim states in India have started to
show some resistance in using vaccines from non-Muslim countries.
Let's see what will happen there.

What is your biggest market?
India is our biggest market. However, we do not sell our finished
products there, but sell raw materials. The Indians produce their
own vaccine but use our raw materials. We've been selling between
550 million to 580 million doses worth up to $13 million annually
since 2000. Every year, India absorbs 800 million doses of raw
materials, including from Italy and Thailand.

(The company, which exports polio, measles, DPT, BCG, and TT
vaccines, is the only vaccine and sera manufacturer in Indonesia.
Bio Farma started its export drive in 1997, boosted by its
recognition as a WHO-certified supplier for polio and measles
vaccine in 1997 and DPT, BCG and TT vaccine in 2000.

With strong support from Unicef, Bio Farma's products have
entered many countries such as Bhutan, the Philippines, North
Korea, Malawi, Mali, Myanmar, Namibia, Nepal, Papua New Guinea,
Pakistan, Thailand, Uganda, and Yemen)

What is your immediate challenge?
The UN has targeted global polio eradication by 2008. By then,
there would be far less demand for OPVs, if not zero demand.
Therefore, we have started to manufacture injectable inactivated
polio vaccines (IPV), which are now common in developed
countries. OPVs have contributed 30 percent to 35 percent of our
total sales. Thus, the success of polio eradication, ironically,
will deal a big blow to us. We will anticipate it by introducing
our IPVs to our traditional market.

What has Bio Farma prepared for the future?
First, we are developing a combo vaccine, a combination of such
vaccines as diphtheria, pertussis, tetanus (DPT) and hepatitis B
in one injection. One shot contains four vaccines. We have been
conducting research for two years now, and the Food and Drug
Supervisory Agency (BPOM) has approved the product. We are now
expecting approval from the WHO next year before we can supply
the product to the global market.
And next year, we are looking forward to add haemophilus
influenza type b (Hib) vaccines to our combination of DPT and
hepatitis B vaccine. The result is five vaccines in one shot.
Our second best product is hepatitis B vaccine, which accounts
for 15 percent to 20 percent of our sales. An international non-
governmental organization, Global Alliance of Vaccines
Initiatives (GAVI), has been assisting the Indonesian government
to develop the vaccines. The government then ordered Bio Farma to
produce the vaccines. GAVI partners with WHO, Unicef, the World
Bank and the Bill and Melinda Gates Children's Vaccine Program.
We are also preparing "uniject" vaccines for hepatitis B. The
innovative uniject uses a similar concept to but higher
technology than the auto-destruct syringes. With uniject, we put
the vaccines in prefillable needles, to prevent reuse, thus the
risk of disease transmission, such as HIV or other fatal diseases
is reduced.
The first automated uniject filling and sealing line in the world
was launched in Biofarma in 2000.

Do you have any plan to go public?
We have no plan to go public so far. The government sees Bio
Farma as working for national interests. As the government
finances procurement from the state budget, it also has a say in
determining the price of our products. If we go public, the
government can no longer determine the price. Even the
international bodies have a role in pricing, considering that the
products are social commodities. Another reason not to go public
is that we might lose international support for research and
transfer of technology, as a public company might perceived as
self-sufficient. We have been supported by grants and transfer of
technology from the Netherlands and Japan, among other countries.