Financial Viability of Medicinal Plant Farming Part 1

The integration of medicinal plant as a crop in agroforestry is a relatively new approach that is beneficial to the local people, whether they are lowland or upland farmers or most especially, the indigenous people. The Ecosystems Research and Development Bureau (ERDB) of the Department of Environment and Natural Resources (DENR) is publishing this issue on medicinal plants as a profitable farming technology to serve as a guide in the development of small backyard herbal gardens, community-based herbal plantation or urban herbal park. This can help boost the Philippine herbal industry by providing adequate supply of raw materials for local as well as global needs.

Manufactured synthetic drugs command a high price which Filipino masses oftentimes cannot buy. The passage of Republic Act No. 8423, otherwise known as “Traditional Alternative Medicine Act (TAMA)” in December 7, 1997 answers the people’s present needs on health care by providing and delivering Traditional and Alternative Health Care (PAHC) products, services and technologies that have been safe, effective, affordable and accessible for Filipinos.

As cited in the research and development work of the National Integrated Research Program on Medicinal Plants (NIRPROMP), the first medicinal plantations were established in Cavite and Davao in order to provide raw materials for the pilot plant of Bicutan in manufacturing of medicinal products. In the establishment of three herbal manufacturing plants of the Department of Health in 1985, pilot plantations of medicinal plants were also established in Cagayan, Leyte, and Cotabato.

With the growing interest on traditional herbal medicine in the country several private companies ventured into the production and manufacture of medicinal plants and products. One of the biggest in the country is the Pascual Laboratory, owner of 40 ha of medicinal plantation in Sta. Rosa, Nueva Ecija.

However, the Philippine Herbal Medicine Industry at this stage is not yet well-developed as compared with China, Japan, Korea and Vietnam. To boost the country’s medicinal industry, there is a need for a holistic paradigm shift of a small- or large-scale farming since the country has sustainable indigenous medicinal plants like ampalaya (Makiling variety), sambong, lagundi, acapulco, and many others.

The Ecosystems Research and Development Bureau (ERDB) of the Department of Environment and Natural Resources (DENR) in collaboration with the Chamber of Herbal Industry of the Philippines (CHIPI), PITAHC-DOH, other government agencies, and private sectors had shared their knowledge and workshops and exhibits on the production and management of medicinal plants. These collaborative efforts are geared to develop community-based herbal plantation in public lands or private farm lots.

These endeavors provide solution to the problem of pharmaceutical companies on the limited supply of raw materials for herbal production. At the same time, it creates livelihood options for upland dwellers and indigenous people in the countryside. Likewise, it helps increase awareness and recognition of the value of medicinal plants in rehabilitating the upland forest ecosystems. It helps promote conservation of forest biodiversity aside from serving as a potential material source of alternative medicine for people on research areas.

Marketing Aspects of Medicinal Plants and Products

Medicinal plants and products now known and used as alternative medicines in the local
market are the following:

a. Commercial available drugs from medicinal plants

  • Lagundi (Vitex negundo L.) As-cof, Pascual Laboratory, for cough remedy.
  • Sambong (Blumea balsamifera (L) DC), for diuretic relief, Pascual Laboratory
  • Akapulco (Cassia/Senna alta L.) lotion, for anti-fungal and skin rushes

b. Plants being developed as drugs (but available in the market as food supplements)

  • Ampalaya (Momordica charantia L. var. Makiling) – relief for diabetes mellitus
  • Ulasimang bato (Pepermia pellucida (L) HBK) – anti-hyperrurecemic
  • Tsaang gubat (Carmona refusa (Vahl) Masam) – anti-motility
  • Mutha (Cyperus pudica) – relief for malaria
  • Makahiya (Mimosa pudica) – relief of diarrhea
  • Yerba Buena (Mentha cordifolia Opoz.) – analgesic

Today many business-oriented groups have ventured into the herbal market.

Appendix 1 shows the list of some producers engaged in the manufacturing of herbal and medicinal products in the Philippines.

Financial Benefits From Medicinal Plants and Products

Herb farmers at San Jose, Dumaran, Palawan who participated in the pilot study of the Department of Health and the Palawan Center for Appropriate Rural Technology (PCART) started to cultivate lagundi (Vitex negundo) and other herbs in their small farm lot. The farmers were able to earn an extra income of P30,000 a year in lagundi farming. On the first year of operation, they obtained a small financial return but apparently in the succeeding years, the financial return increased. The socioeconomic status of the herb farmers dramatically changed. They were able to support their children through school aside from having the means to provide the basic needs of their families.

The intervention showed that medicinal crops gave them extra income rather than doing slash-and burn activities or over-harvesting of forest products. The farmers are now active in herbal farming with the goal of producing high-quality herbal raw materials on a large-scale production.

Herbal farming is a profitable business. The pharmaceutical industry demands tons of raw materials. Therefore, the entrepreneur must know the requirements of herbal farming taking into account the externalities, risks and difficulties of growing and cultivating medicinal plants. The general considerations for herbal farming are: site profiling of the farm or plantation far from pollution, soil that is free from heavy metals, high quality planting stocks to produce high quality leaves, use for organic fertilizer, and non use of insecticides, fungicides or pesticides, moisture content of dry leaves or powdered materials below 5% among others.

A study conducted by one of the professors at the University of the Philippines Los Banos, revealed that medicinal plant farming is profitable. A 1-ha area planted with lagundi or sambong produces 10,000 kg to 20,000 kg of fresh leaves at the price of P15.00/kg in 2 times harvest per year with the gross income worth P300,000 to P 600,000. Deducting the production cost, a farmer obtained a net income of about 106,000 per ha on the first year of operation. The harvest can be sold in dried and powdered forms in order to obtain higher price and profit.

Table 1 shows the price of raw materials of some medicinal plants and other high value crops.

Table 1. Prices of raw materials of some medicinal plants and other high value crops (Source: Information gathered from the Manager of Altermed as per consultative meeting last May 3, 2002)


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