Executing Change: Pharma’s Emerging-Market Strategies in Asia Pacific

Pharma companies are rushing to stake a claim or expand an existing footprint in emerging markets, which offer rapidly growing economies and healthcare investments. These companies are banking, in large part, on a unique trait of emerging markets: that branded generics can maintain sales levels even in the face of patent expiry. Investors worry that multinational companies (MNCs) may be investing huge resources in a quest for additional revenues with no guarantee that these revenues will generate profits. The billion-dollar question is whether branded generic markets will be able to live up to expectations. In this report, we investigate different economic regions as defined by the International Monetary Fund and discuss pharmaceutical company strategies in emerging Asia-Pacific markets. Who is doing what? Where and why? Who are the major players and what are their recent deals and strategies?

Questions Answered in This Report:

• Jacques Tapiero, president of Eli Lilly's emerging markets business, believes that GDP growth is only one indicator of what is driving growth in emerging markets. What are other indicators? What are the different pharmaceutical market segments in emerging markets? Why are Bristol-Myers Squibb and Novartis at two different extremes in their approach to emerging markets?
• In May 2010, Abbott Laboratories announced it would acquire Piramal's Healthcare Solutions business. Why does Abbott CEO Miles White feel that margins in the branded generics business are better than investors might think? Why does he think that emerging markets will become the profit driver of the future?
• In August 2010, AstraZeneca told investors that brands dominate sales in emerging markets. Why? What are the characteristics of branded generics markets? Why does the life cycle of these products after patent expiry differ from that of traditional generics?
• In 2009, Pfizer created an established products business unit to drive sales of off-patent products. Why are physicians key to market segment growth in these markets? What is the expected growth of off-patent markets? What are the key elements of these markets?
• In August 2010, Abbott told analysts that emerging markets will be a competitive arena dominated by only five or six companies. What role does Abbott envision for itself in these markets? What new Abbott initiative will target Russia, India, and China?
• According to IMS Health, AstraZeneca was the fastest growing of the top ten MNCs in BRIC countries (Brazil, Russia, India, and China) plus Mexico and Turkey (BRIC-MT). What are AstraZeneca's goals for BRIC-MT markets? What other MNCs have rapidly growing sales in these markets? What is the projected growth and size of emerging markets?
• In July 2010, Bristol-Myers Squibb (BMS) CEO Lamberto Andreotti told analysts that BMS's emerging market strategy was different from the strategy of most other companies. What is this company's strategy and why does it differ? What market segment is it targeting in emerging markets and why?
• In August 2010, Merck & Co. executives told analysts that Merck was aggressively shifting its resources out of developed markets. What are the company's goals in emerging markets? How does it hope to accomplish these goals?
• In July 2010, Chris Viehbacher, Sanofi-Aventis's CEO, told analysts that no other pharmaceutical company had more sales in emerging markets than Sanofi-Aventis. What are Sanofi's three growth strategies in emerging markets? What market segments is it targeting?

Scope:

Expert contributions: Peter Wittner, Interpharm Consultancy, and Barrie G. James, Ph.D., Pharma Strategy Consulting, offer country-specific emerging market profiles.

Global economies: Recession, economic turbulence in Europe, International Monetary Fund (IMF), relative size of China's economy, $1 trillion emergency funding packages, economic growth by region, gross domestic product (GDP), estimates of the growth in the economies of emerging and developed countries and regions, IMS Health estimates for pharma market growth in 2010.

Geography: Asia Pacific, China, Indonesia, India, Industrial Asia, Asian Tigers, newly industrialized Asia, emerging Asia, developing Asia, Malaysia, Australia, Hong Kong SAR (People's Republic of China Hong Kong Special Administrative Region), Republic of Korea (South Korea), Singapore, Taiwan (claimed as a province by the People's Republic of China), Russian Federation, Association of Southeast Asian Nations (ASEAN), Brunei, Cambodia, Laos, Myanmar, Philippines, Thailand, and Vietnam.

Pharmaceutical markets: Market size and growth, major players, branded generics (BGx), size based on revenues, top public companies, relative size of Asia-Pacific life sciences market, five segments of emerging markets, off-patent markets, Brazil, Russia, India, and China (BRIC), BRIC plus Mexico and Turkey (BRIC-MT), IMS Health size estimates and projected growth of worldwide pharmaceutical markets and emerging markets, 20 largest Asia-Pacific companies, multinational companies (MNCs), domestic companies, free trade agreements, United States, Japan, European Union.

Emerging market strategies: Branded generics, traditional generics, innovative brands, salesforce, R&D strategies, pharmaceutical value chain, life cycles, biosimilars, deals, partners, academic networks, targeted acquisitions, resource shifts.

Emerging country profiles: China, India, Singapore, Indonesia, South Korea, market characteristics, recent deals and strategies.

Please note, the PDF e-mail from publisher version of this report is for a global site license.