Mark Chataway featured in an article by Chris Ross (a freelance writer specialising in the pharmaceutical and healthcare industry) about emerging markets in PME (Pharmaceutical Market Europe), July/August 2015. Pharmaceutical Market Europe is a monthly print and digital title written by experienced journalists and high-profile pharmaceutical and healthcare experts, with over 32,000 readers.  The journal provides insights and offers solutions to the issues that keep industry leaders awake at night.

Hyderus is certainly making its mark on the media, not only in Wales, but in the UK and the rest of Europe.  In the summer edition of PME , Mark Chataway of Hyderus was invited to contribute his thoughts on emerging markets in an article entitled “Choosing Wisely” which focuses on how to target such developing economies effectively.  As a senior consultant specialising predominantly in the pharmaceutical industry and a keen observer of emerging markets, the topic is of great interest to him.

By way of a short introduction, Chris Ross introduces the reader to the concept of  emerging markets and how they can be targeted effectively. You can’t be too choosy about whom you target eg. when faced with launching a breakthrough medicine, you can’t really be selective in your targeting. The question isn’t whom should you target, but how can you target effectively. He goes on to say the the common denominator for all emerging markets is underspending on health.  Although Brazil is already bigger than the UK and China  has become the second largest pharmaceutical market in the world, these countries are still emerging because of the consistent underspend on health.

Asian markets in particular are attracting attention, not due to their spending on health but because of their potential.  Budget constraints result in access barriers being set up, however,  which means that many Asian governments are struggling to gain a foothold.  Global variation in access policies is so pronounced that even developing an overarching ‘emerging market strategy’ is questionable in itself.  

Mark is quoted as saying that the whole concept of emerging markets is dubious..”For example, there is nothing in common between Indonesia and Argentina, whereas Argentina and France don’t look that different.  Most of what these countries are driving towards is consistent but the idea that there’s a strategy that’s going to work across the board is a non-starter.  The countries themselves are closely watching what others are doing.”  Mark,  goes on to use  Mexico as an example of one of the most depressing markets but he says that  experts there are completely up-to-date with what’s happening in other emerging markets.  

He points out that regional variation is also a problem when targeting markets,  citing India as an example where the country’s general public spending on health is low but the Southern states provide good care and are  making every effort to introduce universal healthcare coverage.   In China, richer regions are spending more and reimbursing some of the new cancer drugs.  But Mark emphasises that such regions cannot stray too far from the National Formulary. In Brazil however, thousands go to São Paulo for care each day simply because it’s not accessible at home.  That’s never a good policy outcome.

So are emerging nations introducing western Health Technology Assessment models?  Mark  feels that it’s a mixed bag with regard to this. NICE is a big export and  in Latin America, countries are talking about integrating  NICE  models but in Asia, however, people are less likely to import a ready-made system.  In India, despite enormous expertise, HTA is very nascent.

Mark goes on to say that  “some of the more interesting work in developing nations is – quietly – being done by insurers. There’s growing evidence  that insurers are negotiating with hospitals and drug companies on  NICE-like models.  In Brazil and Argentina, for example, insurers have negotiated deals with pharmaceutical companies for total payment caps, payment by results and even payment based on savings.”

So how should pharma approach emerging markets?  Mark’s answer to this is to be pragmatic and flexible.  Companies need to think carefully about how they classify each market – needing to ask about its commercial potential, is it a smaller opportunity or a social responsibility market.This needs to be borne in mind in order to develop a framework of 10-15 key targets and again these will be different for each company. A company with a capacity for taking  risks may look at places like Kazakhstan (a fast-growing economy with decent spending on health) but on the other hand,  more conservative players may be put off by allegations of corruption there.

“Each country on your list needs to be examined in detail to establish similarities  where one model may work across multiple markets,” Mark says. “Then you need to ask questions like – is there a market there?  Can I get reimbursement?  Is there a private sector there?  What’s the capacity to treat in the private and public sector? … If you look at Indonesia, for example,  it’s got an enormous population but very few oncologists.  Whatever you want to achieve in the next decade, there’s unlikely to be any extra treatment capacity. You therefore have to consider other services that   may make more efficient use of existing capacity,  like a telemedicine service or shared care protocols.  It’s about listening to identify opportunities and developing mechanisms by which to respond to them.  This requires an agile, responsive five-year plan.”

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