Summary

PT Kimia Farma (Persero) Tbk, an Indonesian pharmaceutical company, has partnered with PT Telekomunikasi Indonesia (Persero) Tbk to strengthen digitalisation in its business. The move is aimed at closing loopholes in the distribution of counterfeit drugs and illegal substances such as narcotics. The companies hope that digitalisation will help to prevent the distribution of fake drugs. Honesti Basyir, CEO of Kimia Farma, said that the industry is not yet convinced about digitalisation, but that it could help to detect the circulation of counterfeit drugs and illegal substances, which could be coordinated with the police.
Basyir said that the pharmaceutical industry is not aware that 20% of costs are lost due to drug counterfeiting. He added that the cost of counterfeit drugs is 20% of the total size of the pharmaceutical industry, which is IDR 65tn ($4.5bn). Basyir also said that consumers are often poisoned by fake drugs, which is another loss. The Ministry of Health has recorded that 2% of drug circulation is counterfeit, but there is no system to monitor the details.
Digitalisation could help the pharmaceutical industry save at least 20% of operational costs, according to Basyir. Kimia Farma is targeting a net income margin increase of over 5% in 2019. The company hopes that digitalisation will help it to detect the distribution of counterfeit drugs and illegal substances, which could be coordinated with the police.