The rapid development of emerging markets reshapes the global pharmaceutical industry

Business News Agency September 14th The slowdown in the mature market that has made a significant contribution to the development of the global pharmaceutical industry, multinational pharmaceutical companies are getting closer to the patent cliff, the innovative drug research and development line is drying up, and various countries have imposed stricter regulations on the pharmaceutical market. In the context of interventions, the rapid development of emerging markets is reshaping the global pharmaceutical market. The performance of various multinational pharmaceutical companies in emerging markets is also different. To make these emerging markets a major source of growth, we must rely on the right strategic choices and implement effective tactical strategies.

Recently, Pharm Exec's report analyzed the characteristics of emerging markets and the seven military regulations that followed this market.

Looking for new opportunities

There has been a new trend in large-scale pharmaceutical companies’ seismological march to emerging markets. The focus of recent large-scale pharmaceutical companies is not to seek revenue growth but to seek to break the industry’s current business model.

In Pharm Exec's second annual emerging market review, the company conducted a survey of a group of emerging market participants and found that the pharmaceutical industry is more ambitious and ambitious to develop emerging markets. Each pharmaceutical company has upgraded its emerging market to a company. An important part of the global strategy is to try out some innovative strategies in drug development, sales, improvement and compensation. And the loyalty of healthy consumers with huge potential, diversity, and increasing networking has become the key to this battle.

The incisive remarks made by pioneers in emerging markets apply equally to the large pharmaceutical companies that want to enter the emerging markets at the moment - “We are due to costs, we can stay because of quality, we are now investing in innovation”.

Pfizer, the global pharmaceutical industry overlord, hopes that in the next five years, the proportion of sales in emerging markets will rise from the current 13% to at least 20%. Pfizer's request is quite simple: “The vertical increase is very attractive. This is especially true in Pfizer's therapeutic areas that once created brilliant markets in the mature markets such as cardiovascular, pain, and anti-infection,” said Guilherme Maradei, Pfizer’s vice president of emerging market strategy, “For these products, to enter the emerging markets Just like having a second life, we have found that unmet medical needs in emerging markets have given us the opportunity to improve the quality of life of patients who had not been able to obtain the treatment of our existing products.At the same time, we Also got the opportunity to combine science and patient innovation."

Emerging Market Expansion: 7 to 17

According to new data provided by IMS and Pharm Exec, the emerging market trend is stronger and more pronounced than that discussed in July 2009. Previously, the so-called emerging markets refer to China, Brazil, Russia, Turkey, India, Mexico, and South Korea. According to forecasts, by 2020, these seven countries will become drivers for the growth of the entire industry. Now, IMS has expanded its emerging markets to 17 countries, and these 17 countries will contribute 50% of the global pharmaceutical market expansion in the next three years. By 2014, the sum of the pharmaceutical markets of these 17 emerging countries will reach the sum of the European and Japanese markets, which will increase sales of US$140 billion, while China will rely on its unique advantages to replace Japan as the country following the United States by 2016. The second largest pharmaceutical market in the world.

Access to rising levels of health care, funding and the infighting between generics and innovative drugs is driving the global pharmaceutical market to rearrange. In the latter case, patent expirations for "bombshell" drugs, such as Lipitor, are accelerating and innovative drugs are depleted, which has led to cheaper generics starting to take off in the United States and Europe. This trend may be more pronounced in Europe. Due to the high deficits of European governments, the pressure on European medicine prices is increasing. Even more shocking is that the overwhelming majority of emerging markets have better financial conditions. With the increase in personal income and lower levels of public debt, a large number of individual free spending are another factor in 17 countries in the emerging pharmaceutical market. This factor can slow down the impact of patent expiration on pharmaceutical companies.

New fun of the government

Although these figures suggest a high potential for growth, emerging markets are not exactly fertile. The commitment to improve intellectual property enforcement in many countries will inevitably improve the supervision of products, but it is also inevitable that the local government will introduce favorable policies for local pharmaceutical companies, especially local generic pharmaceutical companies. Patients still have to bear large amounts of health care expenditure, which requires pharmaceutical companies to have the ability to invest voluntarily and take risks for the development of innovative drugs.

More importantly, the government is very interested in this pharmaceutical industry. Although most of them are positive, this may lead to the government's strict control over drug prices and the adoption of European-style measures to limit the entire amount of drug purchases. Turkey is a symbol of this trend. At the beginning of this year, the country had imposed new generic medicines and compensation regulations, so that by 2013, the country's pharmaceutical market will maintain a 5% increase. Jeff Kemprecos, Head of Emerging Markets Public Affairs for Merck & Co., Ltd., said: “For investors in any market, the uncertainty of policy is a killer. When Turkey introduced the reform, it did not inform more people and carry out the minimum negotiation. Therefore, the entire pharmaceutical industry is not optimistic about the prospects of the Turkish market. Merck as a company that competes in global innovation drugs will take measures to reduce the impact on Merck's Turkish market."

Unexploited potential

Overall, the vast majority of multinational pharmaceutical companies still do not fully enter the emerging pharmaceutical market and perform poorly in emerging markets. In 2009, the world’s top 15 mandatory pharmaceutical companies accounted for only 0.9% of sales from China in the first tier of emerging markets, and sales from the second tier of Brazil, India, and Russia accounted for 2.9% of sales from third-tier countries. The proportion is 5.6% (the three levels of the classification of emerging markets are described in detail below). This reflects the continued attention of multinational pharmaceutical companies to the premium of the pharmaceutical market, rather than focusing on the larger generic drugs market, which is typically less profitable. This situation has changed as many multinational pharmaceutical companies now decide to launch generics in emerging market countries.