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Analysis: Vaccine importers make huge gains from FMD outbreak

Jakarta Post - August 10, 2022

Tenggara Strategics, Jakarta – Nearly two months after the first foot and mouth disease (FMD) case was reported, the government finally started the cattle vaccination program for 60.6 vaccine shots in 2022-2023. The vaccines are imported through five companies assigned by the Agriculture Ministry, one of which was a fruit importer that had no previous experience in the health products market.

In the first two weeks of the FMD spread, the Agriculture Ministry imposed lockdowns on affected areas and the police toughened up measures to supervise livestock movements from areas where FMD had been found. Yet, the FMD spread to 52 regencies in 15 provinces across the country within a month. Recent data on July 28 showed the number of infected cattle reached 400,000 head and economic losses estimated at Rp 9.9 trillion (US$664.17 million).

Because the situation was considered an emergency, the Agriculture Ministry directly assigned five importers to bring in FMD vaccines. The importers are PT Imaimas Citra which will import 5 million doses of Aftrosa vaccine from Argentina at Rp 27,000 per shot, PT Elanco Animal Health Indonesia which will import 27.7 million doses of Aftogen Oleo vaccine from Argentina at Rp 20,000 per shot, PT Ceva Animal Health Indonesia which will import 12 million doses of Aftomune vaccine from Brazil at Rp 17,125 per shot, PT Boehringer Ingelheim Indonesia which will import 1.8 million doses of Aftopor vaccine from France at Rp 28,000, and PT Hakikat Alam Indonesia which will import 14 million doses of CAVac FMD vaccine from China at Rp 25,000 per shot.

All eyes are on Hakikat Alam Indonesia because the company received the second-highest vaccine quota despite having no experience in importing health products. The company was founded in 2018 with a license for fruit trading until it was changed into a veterinary drug trading license on June 8. However, the Agriculture Ministry's animal health director justified the assignment saying "All [of the importers] have no experience in bringing in FMD vaccine."

Hakikat Alam Indonesia was not the only one offering to bring in CAVac vaccine. PT Biotis Prima Agrisindo, the parent company of local COVID-19 vaccine producer PT Biotis Pharmaceutical Indonesia, had also offered the vaccine from China Animal Husbandry Co. Ltd. (Cahic) to the Agriculture Ministry. However, the company did not make it to the list of companies receiving direct assignment from the Agriculture Ministry.

The government has started the first phase of the vaccination program to administer 3 million shots. Up until Tuesday, 863,719 animals had been vaccinated, which includes 824,508 cattle, 10,447 buffaloes, 7,897 sheep, 13,816 goats and 7,051 pigs.

What's more

It has been claimed that the FMD spread due to imports of Indian buffalo meat and beef from Brazil since not all regions in those two countries are free of the disease. However, the state-owned logistics agency continues to import buffalo meat from India saying that the assignment was given prior to the FMD outbreak. "We went to India ourselves to make sure that what we bought was really FMD free. I brought my own team and documentation. We always carry out PCR tests, to take samples and make sure that this meat is free from FMD," said Bulog business director Febby Novita.

Meanwhile, Australia and New Zealand have imposed restrictions on meat products brought by travelers from Indonesia. The travelers' baggage is screened and there are disinfectant foot mats at airports. However, no complete closure of the border to Indonesia has been put in place just yet.

What we've heard

A source said Hakikat Alam Indonesia could become an importer of FMD vaccines because the owner of the company is close to a director general at the Agriculture Ministry.

Hakikat Alam Indonesia is a new player in the procurement of vaccines for livestock. Previously, it imported fruit. It also only recently proposed the company become a vaccine importer to the Agriculture Ministry. However, because it often imported fruit from China, Hakikat Alam Indonesia's people have a close relationship with Agriculture Ministry officials.

The source added that Hakikat Alam Indonesia was able to convince officials at the Agriculture Ministry because it had a special relationship with China Animal Husbandry Co Ltd, a company that can produce FMD vaccines. "It also happens that the wife of the owner of Hakikat Alam Indonesia is a Chinese citizen," said the source.

This closeness made Hakikat Alam Indonesia the sole agent for the CAVac vaccine in Indonesia. What surprised many importers of veterinary vaccines was the appointment of Hakikat Alam Indonesia as the sole agent only one week before Agriculture Minister Syahrual Yasin Limpo issued a decision regarding FMD vaccination importers. Only recently did the Agriculture Ministry change its decision that there would be four additional companies supplying vaccines.

Source: https://www.thejakartapost.com/opinion/2022/08/10/analysis-vaccine-importers-make-huge-gains-from-fmd-outbreak.htm