In a significant strategic shift, PT Indofarma Tbk, one of Indonesia's prominent pharmaceutical companies, is transitioning its business model from independent production to a contract manufacturing approach. This decision comes in the wake of recent challenges, including debt restructuring and a fraud case currently being investigated by the Attorney General's Office. The company, which trades under the stock code INAF, aims to streamline its operations and ensure greater efficiency through this new model.

Deputy Minister of State-Owned Enterprises (BUMN), Kartika Wirjoatmodjo, announced that the company's production will now operate on a "made-to-order" basis. This means that Indofarma will only manufacture products after receiving specific orders, primarily from its parent company, PT Bio Farma (Persero). This shift is expected to optimize resource use and reduce waste by aligning production with actual market demand.

The recent restructuring efforts are part of a broader initiative to restore Indofarma’s financial health, especially following the discovery of fraud that led to significant financial liabilities. Reports indicate that the company owes its employees approximately IDR 95 billion (around USD 6 million), which includes back wages. To address these outstanding obligations, Indofarma plans to sell non-essential assets gradually.

This restructuring and transition to a subcontracting model are crucial for Indofarma as it seeks to stabilize its operations and regain trust in the market. The new approach will allow the company to focus more on fulfilling specific customer needs, potentially leading to better product quality and customer satisfaction.

As Indofarma embarks on this new journey, it is essential to monitor the effectiveness of its strategies in overcoming past challenges while adapting to the dynamic pharmaceutical landscape. The company's ability to efficiently manage resources and respond to customer demands will be vital in ensuring its long-term sustainability and growth in the industry.