Summary - Legal

Update on renewable energy investment in Indonesia. There is an interesting article in the Jakarta Post on Geothermal investment. Ind

According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product

onesia has developed only less than a thousand MW of geothermal power although it is estimated to have nearly one-third of the world'

; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.

Examples of combination products may in

s geothermal resources. A research from the ministry of mineral resources mentioned that there are 252 geothermal locations which hav

lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.

e been identified along a volcanic belt extending from Sumatera, Java, Nusa Tenggara, Sulawesi until Maluku. These heat resources has

here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe

the total potential of 27 GWe, which puts Indonesia as the biggest geothermal potential country in the world!

A Jakarta Post op ed

d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.

Combination pro

told that (i) tax uncertainties and (ii) legal uncertainties are among the frontlines of investment barriers. Geothermal investment i

ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc

s really a high risk-high return investment scheme which involves huge exploration and exploitation funds. It is never intended as a

easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi

short term investment. Investors are afraid that their contracts are not being honoured.

I'll give a little comment on the legal bar

nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically

riers. Generally contract observance remained high. Business partners will think twice before deciding to bailout from a contract sin

and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ

ce litigation costs are too high. The problem stems not from observance of the contract but mainly due to regional autonomy. How much

ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi

share will the regions receive are the hot issue. There has been a case where Garut regional government requests Chevron and the Cen

ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.

Following aspects would a

tral Government to disburse concession money for their region. They even threatened to invalidate Article 41 of the Geothermal Law to

dd to the challenges in developing combination products:

Which markets to tap where the combination products can do fairly well?
Which combination prod

the Constitutional Court. Article 41 governs a transitory provision which stipulates that all contracts prior to the entry into fo

cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin

rce of the Geothermal Law will remain valid. Under this transitory provision, regions don't receive any money. Of course, their attem

tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen

pts to invalidate the article are futile.

It must also be noted that the 2003 Geothermal Law gave many power to regions in particula

t?

As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel

r with respect to licensing. This is a good opportunity for investors as they can now deal directly with the regions. During the old

ping new procedures for reviewing their safety, efficacy and quality.

Professional from academic institutions, pharmaceutical industries, health care indust

days, people will have to deal with state owned enterprise such as PLN or Pertamina. However, it is necessary to make sure that both

y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products

central and regional government approves or condone the projects. It wouldn't be good if after a few years of investing the license g

.

As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de

iven by regional government is revoked by the central, or a license given by central government is revoked by the central. In any eve

elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.

Companies that provide selfless information through particip

nt, although the regions are granted more power, it is always important to asks some sort of condonation from the central government.

tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products

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