Unlocking and Accelerating Growth: Healthcare and Life Science in Asia Pacific

FenXun established a joint operation office with Baker McKenzie in China as Baker McKenzie FenXun, which was approved by the Shanghai Justice Bureau in 2015.

In Japan, special support available to global companies conducting R&D projects in Japan, including fundraising assistance for small and medium sized businesses, faster patent examinations, residency applications and review periods on new investments.

Competition for prize assets will increase demand for creative financing strategies from PE players. Private credit arrangements, joint ventures that include PE and strategic player and club deals, where multiple

A variety of strategies are being adopted by companies to ensure operational resilience, including M&A. Some are shedding ‘non-core’ business units to focus on building specialty platforms. Others are using M&A to acquire expertise and R&D for innovative treatments and patient experience solutions. An analysis of how to maximize the advantages of technology and digital capabilities is also fueling resilience-driven activity.

Private equity interest in healthcare assets, particularly core plus’ assets, remains strong in Asia Pacific. Some Asian healthcare focused private equity firms are engaged in capital raising for new funds focused on investing in the healthcare sector in southeast Asia. Moreover, continuation funds are being deployed by some private equity firms to roll over the ownership of existing well performing healthcare assets.

Working to strengthen its international trade relations. The EU-Vietnam Free Trade Agreement ensures the use of international standards, practices, and guidelines developed for pharmaceutical products and medical devices, to help Vietnamese products gain wider acceptance in international markets and boost exports.

Improving the regulatory framework for the pharmaceutical sector to ensure high quality domestic production, robust IP protection and licensing will also support growth. Vietnam benefits from its membership to ASEAN and coordinated efforts to harmonize regulation across the region.

The government has participated in international medical and wellness exhibitions, simplified the process of getting visas for medical purposes and developed marketing campaigns to attract medical tourism.

The Eastern Economic Corridor (EEC), an area-based development initiative, also offers efficient infrastructure, connectivity and incentives to attract knowledge-based industries, including biosciences, artificial intelligence and robotics into Thailand.

Thailand’s logistics infrastructure and comprehensive cold chain network is also suited to the specific needs of the life sciences and healthcare industry. The government continues to make improvements to resilience and sustainability, including a recent grant from the US Trade and Development Agency (USTDA), which will accelerate more sustainable distribution routes like road to rail.

Thailand’s strategic location as a gateway to Asia Pacific, skilled workforce and supportive government policies have seen the value of foreign investment rise by 43 per cent to USD 11.5 billion for the first nine months of 2023. This reflects investors' confidence in Thailand's infrastructure, supply chains and long-term growth potential.

The Board of Investment (BOI) provides exemptions from corporate income tax to certain industries, including those involved in manufacturing and logistics, and has approved incentives to support the adjustment of existing production lines to manufacture medical devices or parts, including exemptions from import duties. This can significantly lower the cost of setting up or expanding manufacturing facilities.

Map supply chain risk. Use data to build a picture of actual and potential risks across your supply chain, including environmental issues such as medical waste and pollution arising from processing APIs, and social considerations like healthcare equity and access to affordable health. Identify hotspots and mission critical issues that could disrupt supply or lead to reputational issues and disputes.

It's important to remember that intellectual property is often the key value driver in collaborations and partnerships. To unlock further value, there must be

It’s encouraging that foreign investors continue to invest in Vietnam's manufacturing sector. These investments reflect the broader trend of shifts in companies diversifying their supply chain and manufacturing operations beyond China and into Southeast Asian countries. This is driven in part by geopolitical dynamics and global trade reform among major markets. Vietnam is well-positioned in terms of geography and political stability as it deepens its role in global supply chains, and remains cost competitive whilst also focusing on up-skilling the workforce.

Thailand is emerging as a key manufacturing, logistics and research hub for healthcare and life sciences. Apart from its strategic location as a gateway to Asia Pacific, skilled workforce and supportive government policies, Thailand is a destination for high potential growth, serving both local and international demand for medical tourism because of our well-established, high-quality hospitals and medical facilities, many of which are expanding internationally. As part of the blueprint to drive the Thai economy forward via digital transformation, the government is granting premium incentives to foreign investors to promote advanced technological development in targeted S-Curve industries, including medical and medical robotics.

When it comes to ESG governance, reporting ad regulatory compliance, companies must address contractual risk. The best approach for avoiding action is to confirm in advance that a company can live up to specific duties and obligations before agreeing to them. It is also advisable to agree on liability limitations to make the remaining risk manageable.

Information on environmental performance, employment and working conditions in supply chains can be difficult to uncover, but it is critical to overall transparency. Use digital tools to access the best possible data on key aspects of ESG and create a platform to aggregate and organize material for ease of reference. Additionally, measure impact and communicate progress to build accountability. Integrate supply chain ESG performance into global reports.

Carve-outs, spin-offs and take-private deals are increasingly important features of the market,
as corporates address balance sheet vulnerabilities and redeploy capital for growth.

Asia Pacific is a global production powerhouse, and outsourced manufacturing and distribution is of huge strategic importance to global healthcare and life sciences companies in the region.

Trade compliance is one of the most complex and high stakes legal consideration for global players in Asia Pacific, particularly as scrutiny of tariff classification, customs valuations, duties and product origin verification rises.
Getting up to speed on what is driving audit activity and taking a proactive, localized approach will promote operational resilience.

Transparency and accountability are key trends for corporates globally. Having a clear view of ESG obligations and performance, operational risks and litigation hotspots will help ensure disclosures are made appropriately.
Additionally, leadership commitment, corporate governance and a robust ESG compliance program are crucial to success.

Regulators are weighing regulatory approaches to AI, with different jurisdictions fevering different regimes.

Numerous jurisdictions are enforcing against failures to file. Identify these regulatory hurdles as early as possible in transaction discussions so you can incorporate these considerations into your transaction strategy, budgets and deal timetable.

Protecting IP and managing liability to avoid disputes should be high on the agenda, particularly as collaboration between digital players, big pharmaceuticals
and public institutions grows.

Filing obligations across multiple jurisdictions can be triggered easily and filings need to be made quickly to keep to deal timetables. Good planning can prevent delays as most regimes around the world are mandatory and require parties to standstill until formal clearance.

As the Philippines undertakes reforms to provide universal healthcare, there is a real need for private sector investments in healthcare services and facilities, such as clinics, hospitals, specialty centers and laboratories, to scale up access for the wider public.

With spending constraints curtailing further transformation, governments are increasingly looking to the private sector investment to fill the gap. As a result, private capital investors including the superannuation, pension and infrastructure funds, private equity and venture capital firms and high net worth individuals are driving much of the healthcare and life sciences transactional activity in Asia Pacific.

We are seeing strong interest in Asia by global pharmaceuticals and biotechs, including billion dollar plus global deals involving platform technologies and regional deals targeting specific Asian markets.

Governments across the Asia Pacific region have identified the power of AI to help address national healthcare challenges and turbocharge innovation, investment and economic growth. Favorable government policies have been and will remain key to growth.

Creating safe and effective AI products can be an expensive and complex venture, particularly in AI drug discovery, where IP is diverse – from datasets and algorithms to molecules and antibodies. As such, the commercial protection of these innovative technologies has become a pivotal issue.

As AI is integrated into drug and patient pathways, risks and uncertainties are emerging. Regulation is evolving piecemeal behind the technology, data privacy, accuracy and bias are significant concerns, and existing frameworks around IP and competition are being challenged by the new. Managing these issues will be critical to realizing safe and sustainable growth.

Collaboration between data providers, developers, public institutions, life sciences and healthcare providers is common in digital health. But in entering collaborations, companies can overlook the treatment of intellectual property, know-how, trade secrets and confidential information.

FenXun established a joint operation office with Baker McKenzie in China as Baker McKenzie FenXun, which was approved by the Shanghai Justice Bureau in 2015.

People are willing spend more to have greater access to healthcare; and quality healthcare at that. Through the peak of COVID-19, people have become more willing to seek medical attention to allay risks, which means that preventative health, health screenings and wellness services are also in higher demand.

Hospital-at-home programs offer financial advantages for healthcare institutions due to the reduction in required bed space. Although they must invest in the technological infrastructure to allow 24/7 remote monitoring of patients. In Singapore, hospital-at-home programs have been largely offered by public hospitals, but it’s likely similar programs will be increasingly offered by private healthcare institutions, which will impact payment models and investment patterns.

Across Asia Pacific, healthcare and life sciences breakthroughs offer exciting opportunities to meet patient needs and create value, but rising costs and market uncertainty also apply significant pressure to operations and balance sheets.

Telehealth and digital therapeutics are the new normal, and regulators are strengthening rules to protect patient data, ensure safety and support positive patient outcomes.