The latest gold rush
MNCs continue their surge into emerging markets, with the latest deal between GSK and Dr Reddy’s Laboratories. This comes after GSK’s recent moves in other emerging pharma markets in sub-Saharan Africa, China, Singapore, Argentina, Chile, Egypt, and Pakistan. Pfizer is seeking to add $3 billion in annual sales by 2012 in developing markets and is targeting China, Brazil, Mexico, Russia, Turkey, India and to a lesser extent, the Middle East to help lift its 4 percent market share. Pfizer is aiming to go from the third position to the first in emerging markets. It already has deals with Aurobindo Pharma and Claris Lifesciences. Eli Lilly also has a research deal with Zydus Cadila.
However branded medicines are not the first choice in emerging markets. A recent DDB Health survey has fresh statistics to prove this. 54 percent of the 1,800 consumers and physicians surveyed in 11 countries (the US, Canada, Mexico, Brazil, the UK, France, Germany, China, India, Australia and Singapore) said they prefer generics to branded drugs. When asked if they would prefer the latest medicine in its field or one that has been around for awhile, 70 percent said they’d take the tried-and-true drug over the latest and greatest.
Half of consumers and 44 percent of doctors said they’d do anything to avoid taking medication until absolutely necessary; suggesting a mistrust of the pharma industry as well as the mindset that resorting to medication is a sign of personal failure or moral compromise. But there is some hope for the pharma industry as 67 percent consumers believe that the benefits of most medicines outweigh the risks and 77 percent felt that modern medicine has improved society.
The survey only reflected trends MNCs were well aware off and they already have their ’emerging market’ strategies in place. Increasingly, they are looking at healthcare needs of individual countries and tailoring their offerings accordingly. In many ways, big pharma is learning to think small. Most MNCs are taking baby steps towards collaborations and alliances, favouring brands and market acquisitions over complete buyouts. No doubt, this cautious approach will yield smaller pickings but everyone knows that the gold vein is here to stay and only a long term approach will give sustainable results.