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tate-run pharmaceutical companies PT Indofarma and PT Kimia Farma have expressed their commitments to using more locally produced raw materials in order to reduce reliance on imports.

Indofarma corporate secretary Yasser Arafat said on Tuesday that his firm would start focusing on producing raw materials for certain drugs from next year onward to help reduce imports, as encouraged by the state-owned enterprises minister.

'€œWe, along with other pharmaceutical firms, are now formulating a roadmap to reduce imports,'€ he told The Jakarta Post.

Taking a further step, another state-run pharmaceutical giant Kimia Farma is now waiting for the commission of its newly established pharmaceutical plant.

'€œThe construction of the plant is complete. We'€™ll commission the plant as soon as we get the authorization from the Food and Drug Monitoring Agency [BPOM],'€ said Kimia Farma finance director Farida Astuti on Monday after a closed meeting of the finance directors of state enterprises.

Once the plant begins commercial production, the company could help reduce imports of pharmaceutical salt by around 50 percent, she said.

The pharmaceutical salt plant is set to produce up to 3,000 tons of salt per year, or half the national pharmaceutical salt demand of 6,000 tons a year.

Pharmaceutical salts are used for various purposes such as the production of intravenous fluids, sports drinks and beauty products.

It was previously reported that Kimia Farma spent around Rp 28 billion (US$2.08 million) from its internal cash reserves for the construction of the plant.

The presence of the new pharmaceutical plant will be of importance for the country'€™s pharmaceutical industry as it will reduce the industry'€™s heavy reliance on imports, which currently account for more than 90 percent of domestic pharmaceutical raw material needs.

State-Owned Enterprises Minister Rini Soemarno urged on Monday all state-run pharmaceutical companies to find a way to reduce imports of pharmaceutical products, which have long contributed to rising import rates in the country.

The total value of the country'€™s pharmaceutical imports surged by 17.03 percent to US$296.77 million in the January to May period of this year, from $253.59 million in the same period last year, according to data from the Trade Ministry.

The relatively high import levels of raw materials have also affected the operating expenses of both Indofarma and Kimia Farma.

Kimia Farma suffered foreign exchange (forex) losses of Rp 402.4 million in the first half of this year, although this was far below the Rp 4.31 billion recorded during the same period last year.

The firm'€™s net profits increased by 9.7 percent year-on-year (yoy) to Rp 77.44 billion in the first semester of this year from Rp 70.58 billion last year.

Indofarma, meanwhile, put up a stronger performance in the first half, during which it reduced its net losses to Rp 23.81 billion from Rp 50.9 billion in net losses in the same period last year.

The firm'€™s rising cost of goods sold has become a prominent factor squeezing the firm'€™s growing revenues.

Indofarma'€™s Yasser said that he was upbeat that his firm would record a better performance in the second half as many drug orders from the government would be realized around July and August.