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9781412934633-Chap-26 1/10/09 8:57 AM Page 393

SINGAPORE’S DEVELOPMENT POLICIES 393

for FDI. In 2001, the Singapore government – the large pharmaceutical corporations have not
frustrated by the seemingly ‘unfair’ competi- been seen ‘going abroad’ to acquire cheaper
tion – officially disengaged from the Suzhou resources in the third world (Rugman, 2005).
Industrial Park project. Although The main reason for this is that there is ‘... a
it remains as a minority shareholder in the set of stringent local and regional regulations
project, it has effectively handed over [which] prevent pharmaceutical companies
the administration of the Park to the Chinese from adopting a global strategy’ (Rugman
government (Pereira, 2003). and Brain, 2004: 13). These regulations
include national drug approval processes,
price controls and most importantly, quality
control. Hence, pharmaceutical corporations –
Competition, again
regardless of their size – tend to remain
3
Although its regionalization strategy is still regional or local rather than global (Rugman
in operation, the Singapore government and Brain, 2004: 24). While there is some
re-assessed its policy options for the future, evidence that the large pharmaceutical com-
and eventually rolled out yet another large- panies have attempted to export to new mar-
scale project designed to re-establish the kets, products bound for a particular region
island’s ‘competitive advantage’. The are often produced within that region. To illus-
Biomedical Sciences Initiative, launched in trate, pharmaceutical companies do not pro-
2003, has many thrusts. On paper, the duce drugs in so-called ‘low cost’countries for
Singapore government claims that it is re-export back to the US consumer market (see
hoping to eventually become a hub of for example Rugman, 2005).
biotechnology production and research and Against this economic backdrop, the
development (R&D). However, based on Singapore government tried to position the
what the Singapore government actively pur- country as a low cost but high quality loca-
sued between 2003 and 2005, it became clear tion for pharmaceutical production and
that the strategy involved targeting ‘pharma- R&D. Late in 2001, before the Biomedical
ceutical FDI’. More specifically, the Sciences Initiative was officially launched,
Singapore government was encouraging the Singapore government began to invest
large pharmaceutical corporations to set up heavily in building specialized infrastructure
production facilities in Singapore, along with and developing human resources with the
some pharmaceutical research and develop- hope of attracting large pharmaceutical cor-
ment activities. Although the pharmaceutical porations to set up production facilities, as
sector is generally distinct from the biotech- well as R&D activities on the island. The two
nology or biomedical sector, there are many largest infrastructural investments were the
overlaps. For example, pharmaceutical cor- building of the Tuas Biomedical Park and the
porations are known to invest and acquire Biopolis. The Park is a purpose built indus-
biotechnology companies that can contribute trial estate with ‘state of the art’ logistical
to drug development. Regardless, as far as and technical facilities that can satisfy even
the Singapore government is concerned, the most technologically advanced produc-
pharmaceutical activities, along with medtech tion (paraphrased from Tuas BioMedical
4
(which refers to medical technology), are Park marketing brochure ). The investments
considered part of the biomedical sciences made in the infrastructure preparation were
initiative. reportedly over US$0.6 billion. Thisincluded
What is interesting about the Singapore high technology water treatment facilities as
government’s initiative is that the pharma- well as logistics facilities. The investments
ceutical sector is not normally known as have paid off, as these sites have been
being ‘globalized’. Unlike, for example, approved by the biotechnology corporations
textiles, and the automotive or electronics sectors, as having the basic quality control, whereby