Pharmaceutical industry in Taiwan

The origins of Taiwan’s pharmaceutical sector date back to the 1960s, when government initiatives encouraged domestic medicine production to reduce dependency on imports and Taiwan shifted from repackaging to manufacturing domestically produced antibiotics, formalin, and other chemical products. The Taiwanese government's 1968 Resolution promoted national pharmaceutical self-sufficiency, leading to the establishment of local drug manufacturers. During the economic surge of the Taiwan Miracle in the 1960s and 1970s, the government supported the pharmaceutical sector through industrial planning and infrastructure investments such as the Ten Major Construction Projects. The establishment of the Pharmaceutical Affairs Law in 1970 and its updates throughout the 1990s and 2000s laid the legal foundation for safety standards and regulatory control over drug manufacturing, importation, and marketing.^[4] By 2000, the industry had grown with approximately 280 Western medicine producers and 250 traditional Chinese medicine firms.

As of 2023, Taiwan hosted around 59 pharma manufacturing sites, including 44 with U.S. FDA or European Medicines Agency approval and 7 approved for the Chinese market. According to Global Data Healthcare, Taiwan has comparatively more high-value Active ingredient biologics and injectables capacity for its size compared to China, despite the fact that the two countries' workforces speak the same language.^[5] These facilities are concentrated near Taipei, Taoyuan, and Tainan, with Taoyuan alone accounting for 30% of all domestic sites.^[6]

The sector features a mix of domestic and foreign-owned companies. While most facilities are Taiwanese-owned, international companies also operate in Taiwan. Companies specialize in APIs, commercial dose injectables, biologics, and Contract manufacturing organization services. Emerging biotech firms such as Taimed Biologics [zh],^[7] and Taiwan Bio-Manufacturing Corporation (TBMC)^[8] focus primarily on advanced therapies, monoclonal antibodies, gene therapies, and vaccines.

Taiwan's R&D intensity ranks among the highest globally, with total R&D expenditure reaching NT $898 billion (US $27.8 billion) in 2022—nearly 4% of GDP, the highest proportion in its history.^[9] In the biomedical space, the government's "5+2 Innovative Industries Plan" has prioritized biomedicine since 2017, aiming for annual output of NT $1 trillion (~US $32 billion) by 2025.^[10] Government-backed initiatives include research subsidies, infrastructure development, and legislation such as the Act for the Development of Biotech and New Pharmaceuticals Industry (2007). R&D funding—covering tax incentives, grants, and collaboration with public science parks—has spurred innovation, particularly in generic drug development.^[11] As of 2011, six local firms received NT$220 million in government subsidies (~US $7.7 million) to bolster R&D for generics.^[12]

The Taiwan Food and Drug Administration (TFDA) was established in 2010, integrating multiple agencies to oversee pharmaceuticals, food safety, and medical devices. Taiwan’s API standards have been recognized by the European Commission as equivalent to EU requirements, and as of 2017, over 115 locally developed drugs held Investigational New Drug approval from the United States Food and Drug Administration.^[13] These modern regulations enable Taiwan's pharmaceutical companies to seamlessly transition from Phase II to Phase III trials in Western markets. Taiwan continues working with international regulators to promote collaborative drug development and global market integration.^[14]