Abstract
Japan' s pharmaceutical markets are increasingly more competitive, and a steady
restructuring of the Japanese pharmaceutical industry is under way. The
government continues to tighten its control over drug expenditures, and
foreign and multinational pharmaceutical companies are strengthening their
foothold in Japan by launching a wide variety of new drugs. To successfully
navigate the changing waters of the world' s second-largest pharmaceutical
market, companies must understand today' s evolving business environment and
institute a plan of action to realize their mid- to long-term visions.
Get the Answers You Need to Shape Your Strategy
- The Japanese government intended to implement annual price revisions in fi
scal year 2007, but the measure has been temporarily shelved, because many
thorny issues regarding Japanese practices of dispensing drugs need to be
resolved before annual price revisions can be instituted. Nevertheless, why
should the pharmaceutical industry in Japan anticipate that the government may
implement annual price revisions in a high-handed manner in fi scal year 2009?
- The advent of "triangular mergers," whereby foreign companies are allowed
to use their stock to acquire or merge with Japanese companies, arrived in May
2007. Why is this new M&A tool particularly likely to accelerate the
restructuring of Japan' s marketplace? Why might Takeda represent an especially
attractive takeover target?
- The Japanese market continues to be subject to less aggressive generic
erosion than the pharmaceutical markets in the United States and in some
European countries. But in May 2007, the government called for an increase in
the market share of generics from 16.8% (by volume) in 2004 to at least 30% in
2012. In spite of the government' s goal, why may some branded drugs remain
impervious to generics competition?
- Japanese pharma' s growing interest in biologics is refl ected not only in
several recent deals for biologics but also in an expanding pipeline of
late-stage recombinant proteins and monoclonal antibodies (MAbs). Which
Japanese companies historically having little interest in biologics now have
one or more biologics in late-stage development? Which companies have entered
into deals in 2007 to acquire MAbs and MAb technology?
- The Japanese government aggressively cut prices for long-listed drugs in
2006, after indicating that a similar cut in 2004 was meant to be a one-time
event. Which type of company has the additional price cut proven particularly
hurtful to?
Scope
- The Japanese pharma landscape: market size and demographics; growth
rate of health care expenditures; overall health care expenditures relative to
gross domestic product; total market value of Japan' s largest domestic
pharmaceutical companies; best-selling drugs in Japan.
- The government' s role in containing drug expenditure costs:
cost-containment measures by the Ministry of Health, Labor, and Welfare;
Japan' s National Health Insurance system; biennial drug price revisions;
increased emphasis on promoting generic drugs; the DPC "fl at sum"
reimbursement system; proposals to revise drug prices annually; price cuts for
long-listed drugs.
- Japanese biologics: dominant players in the Japanese biologics
markets; late-stage biologics in Japanese company pipelines.
- Generics: the growing acceptance of generics within the Japanese
marketplace; the government' s increased emphasis on generics; reimbursement
system for hospitals; new entrants in the Japanese generics market; overall
outlook for the Japanese generics market.
- The growing impact of foreign companies: the strengthening foothold
of multinational companies; increased competition for domestic pharmaceutical
companies; efforts to accelerate the launch of global drugs in Japan.
- Recent mergers and acquisitions: Chugai and Roche Nippon; Daiichi
and Sankyo; Dainippon and Sumitomo; Tanabe and Mitsubishi; Yamanouchi and
Fujisawa; revisions in corporate law to provide for "triangular" mergers.
- Navigating Japan pharma' s stormy waters: outlook for growth in the
Japanese pharmaceutical market; the probability that M&A activity will
continue for Japanese companies; ongoing attempts to improve the reliability
of generics; the ongoing fi ght for market share; the need for companies to
devise a plan of action.
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