Spectacular Market Launches Key To Enduring Success Of Brands In Asia - IMS Health

Data show that "pharmerging" markets, will grow at 14-17%, while the U.S. will lag with 3-6% growth, Europe will grow at an even slower rate of 1-4% and Japan will move at 2-5% in the next four years, underscoring the importance of Asian markets, IMS stresses.

MUMBAI - Following studies on the launch of patented brands in the Asia-Pacific market, IMS Health said less than 20 percent of brands perform well if they do not strike significant success within the first six months of their launch.

Product launch strategies for Big Pharma in countries like India and China need not be any different from the developed markets like Japan, U.S. or Germany, and overall conditions are similar in those markets, according to IMS Health research.

The pharmerging markets - the term IMS Health uses to categorize 17 countries like Brazil as the next frontiers of growth - also show similarities to the developed markets when it comes to ideal conditions for new launches. IMS Health, however, singled out India, noting that the country's large domestic market of generic drugs may require a slightly differentiated play for new products.

Ensure A Spectacular Launch Or Fail

As in the developed markets, only one in five patented drug launches in emerging markets significantly improve their performances if they do not have success in the first six months after their market introductions, according to IMS.

"Overall, the pharmerging markets are taking the shape of the developed markets," Dean Edwards, VP, Sales, IMS Health commented in a virtual conference organized last month by Elsevier Business Intelligence. Edwards added that a launch needs very good planning and execution to ensure a successful launch in a short period of time to beat the odds for new product launches.

"You cannot get a second bite of the cherry," Edwards noted in a lighter vein.

Edwards noted the sales growth of new market launches in China is getting steeper. Cancer drugs like Tarceva (erlotinib) and Nexavar (sorafenib) are outpacing the growth trends of older market entries like Glivec (imatinib) and Herceptin (trastuzumab).

Baraclude Shows The Way

Edwards commended the success of Bristol-Myers Squibb's brand Baraclude (entecavir) in China, saying it was almost like a case study of a successful launch. BMS recognized there was a genuine need for a hepatitis B drug in China, where 11 percent of the population is affected by the infection, and committed adequate resources for a successful launch.

While BMS has a presence in eight select markets in Asia, some large companies still do not have a presence that relates to their growth potential, which may point to the difficulties of entering markets dominated by local generic players.

In an earlier presentation, IMS Health said Roche may be right in not venturing into the generics segment and adhering to its dependence on innovative drugs (Also see ""Roche May Be Right" In Not Taking To Generic Drugs - IMS Health; "Innovation Surge" From 2016 Will Help Big Pharma" - Scrip, 13 Dec, 2010.).

Stick To The Rule Of 5 A's

The IMS analyst compared realities in the Asian markets with those of developed countries like the U.K., France, Germany and Japan while advising companies to follow the rule of "Five A's" for marketing a drug - adherence, adoption, access, approval and advocacy.

Digging deeper, he said companies should ensure adherence to issues such as compliance or make efforts to see that patients follow prescriber labeling.

Edwards, who is based in Hong Kong, also emphasized two main issues confronting the Asian markets - access and advocacy - which companies can address by building stronger bonds with patient groups, pharmacists, payers and nurses.

Asian markets, he continued, will grow as a region and attract resources for at least the next three to five years.

"Changes in the market will not happen overnight and so many MNCs can still leverage older, original but off-patent assets like brands for diabetes products for a few years more through proper planning," he advised, adding that pricing pressure may intensify for branded generics or brands for which patent protection has expired.

Asia-Pac Excites As U.S., EU And Japan Sag

According to IMS Health, Asia Pacific remains the most exciting place to do business at the moment, but pharma needs to negotiate the challenges faced on a day-to-day basis in those markets. IMS Health estimates the world market will be valued at around $1.1-1.3 trillion by 2014 with a compound annual growth of around 5-8 percent.

The IMS executive advised companies to act fast on their plans as competition has intensified and there is a need to respond to opportunities and market changes.

At the PharmAsia Summit in October 2010, prominent speakers drawn from a spectrum of multinational pharma companies such as Merck agreed that Western companies expanding in emerging markets are likely to distinguish themselves from competitors by successful execution and understanding of local markets, more so than by broad strategic differences (" (Also see "Western Companies' Perspectives On Emerging Markets: Execution Trumps Strategy - PharmAsia Summit" - Scrip, 29 Nov, 2010.)).

IMS emphasized that the need to foray into the Asia markets becomes even more pertinent as data show that the pharmerging markets, including Asia, will grow at 14-17 percent while the U.S. will lag behind with 3-6 percent growth, Europe will grow at an even slower rate of 1-4 percent and Japan will move at 2-5 percent in the next four years.

China Scorching, Stands Out From The Rest

Amongst the pharmerging nations, Edwards made a particular note of China's nearly 25 percent growth - at the back of massive health care spending by the government and cautioned that growth in China should not be confused for growth in the other Asia-Pac economies.

Countries like Vietnam and Indonesia have similar growth trends but Edwards reminded the audience that those countries' base levels are much lower compared to China.

Edwards said companies will have to tailor their portfolios, clinical development and commercial models to local needs and develop strong leadership teams to execute the chosen strategies.

Big Pharma's Musical Chairs

Over the last few months, Pfizer, Johnson & Johnson and Bayer recorded decelerated sales, as opposed to GlaxoSmithKline, Novartis and Merck, which posted accelerated sales in the last year. This trend goes against the historic growth seen in the last five years, according to Edwards.

He noted that Bayer, Pfizer and J&J have been active in primary medicine such as diabetes, dyslipidemia, hypertension, pain and some of the simpler CNS and neurology areas, while firms like Novartis are more focused on oncology and other specialty areas.

- Vikas Dandekar ([email protected])

[Editor's note: Want to know more about drug pricing in China and healthcare reform? Elsevier Business Intelligence will be hosting an audioconference on China Pricing and Healthcare Reform: Outlook for 2011 on February 8. For information click here.]