Legal & Regulatory > Thailand > Localization

Localization in Thailand – a legal guide. Prepared in association with Tilleke & Gibbins, a leading law firm in Thailand, this is an extract from The Pharma Legal Handbook: Thailand, available to purchase here for GBP 119.

1. Are there any rules or regulations requiring and/or encouraging localization in your country? What is the legal framework defining these localization rules and policies?

Yes. Pursuant to Section 12 of the Drug Act 1967, as amended, any domestic manufacturing, importing or ordering into Thailand, including the distributing of active pharmaceutical ingredients, intermediate and bulk medicinal products, and finished medicinal products is subject to authorisation from the Thai Food and Drug Administration (FDA). The licenses for domestic manufacturing, importation and distribution are valid for one calendar year. The license must be renewed before 31 December each year. Following the obtaining of the license, the manufacturer or importer must submit the registration dossier of the medicinal product intended to be manufactured or imported into Thailand, pursuant to Section 80 of the Drug Act. 

The Thai FDA only grants manufacturing/importation/distribution licenses to entities with a physical address in Thailand. Foreign applicants may be able to obtain authorisation if they have a branch office in Thailand

Clinical Trials

The clinical trials are not required to be conducted locally as a condition for obtaining marketing authorization in Thailand.

2. Have there been any recent significant changes involving localization rules? If yes, when did they take place and what did they involve?

There have not been any recent significant changes involving localization.

3. Is the process of obtaining a marketing authorization impacted by localization policies in your country?  If yes, how so (what are the incentives received or the requirements)?

Yes, the process of obtaining marketing authorization is impacted by localization policies, as medicinal products may only be marketed in Thailand if a marketing authorisation license has been granted by the Thai FDA, as prescribed in the Drug Act.

Foreign marketing authorizations are not recognized in Thailand. However, the Thai FDA requests that the importer submit a Certificate of Free Sale (CFS) or Certificate of Pharmaceutical Product (CPP), as issued by the regulatory authority in the manufacturing country as part of the dossier requirement. Without the CFS or CPP, the Thai FDA may not approve the marketing authorization license. The Drug Act provides that applicants for and holders of marketing authorizations must be established in Thailand.

4. Is the pricing process for pharmaceutical products impacted by localization policies in your country? If yes, how so (what are the incentives received or the requirements)?

No. Both domestic manufacturers and importers who place medicinal products on the market are free to determine the prices for their medicinal products when selling to wholesalers, healthcare professionals, pharmacies and/or other authorised retail sellers.

5. Is the reimbursement of pharmaceutical products impacted by localization policies in your country? If yes, how so (what are the incentives received or the requirements)?

The reimbursement of pharmaceutical products is not impacted by localization policies in Thailand.

6. Is the access to public or public tenders of pharmaceutical products impacted by localization policies in your country? If yes, how so (what are the incentives received or the requirements)?

No. In a state agency’s procurement procedure in Thailand, public hospitals may require the tenderer to have the necessary authorizations to market the products concerned. As mentioned in our answer to question 114, marketing authorization license is granted to a company established in Thailand. Therefore, such pharmaceutical company can be the contracting party with the public hospitals.

7. Are import tariffs, importation and/or exportation permits, trade and/or taxation of pharmaceutical products impacted by localization policiesin your country? If yes, how so?

Import and Export

Please see question 114 above. Any importation/exportation of medicinal products is subject to marketing authorisation from the Thai FDA. The Thai FDA only authorises companies with an address in Thailand. 

Taxation and Import Tariffs

Thailand’s Board of Investment (BOI) offers both tax and non-tax schemes for companies involved in research and development. In principle, the BOI maintains a policy of giving special consideration to investment projects that promote economic clusters to create and concentrate investment in accordance with Thailand’s potential and to strengthen value chains, as well as to promote investment in specific areas in Thailand, such as the Eastern Economic Corridor and southern border areas of Thailand. Biological products and vaccines are one of the clusters in biofuels and biochemicals that the government is promoting. Additionally, BOI-promoted companies may be granted exemptions for import tariffs on imported goods. 

8. Are there any other incentives or advantages offered by the current local localization rules in your country? If yes, what are they?

Since December 21, 2020, the BOI has approved a series of stimulus packages aimed at encouraging both local and foreign investment, as the government seeks to boost Thailand’s economic recovery from the COVID-19 pandemic. Biological drugs and vaccines are targeted industries, which will be entitled to an additional corporate income tax deduction for a period of five years.

9. Are there discussions about the possibility of implementing localization policies in your country? If yes, what are the proposed reforms and when should they come into place?  

There are currently no on-going discussions about the possibility of implementing further localization policies in Thailand.

Line 1 

0 – if neutral

R – if a requirement

B – if provides benefit

Line 2 and 3 Fill in (according to answer in Line 1)

MA – Market Access

P – Pricing

R – Reimbursement

T – Tenders

Tx – Taxes and import tariffs