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Setting the Scene Outlook for Healthcare Industry from 2010-12 Global Healthcare Market : 2009
US and Europe were impacted in a major way by global crisis
Asia also slowed down but not as much as the West
Valuations were low and M&A was high, many smaller Biotech companies struggled
Major organizational restructuring occurred, along with portfolios being reassessed
Global Healthcare Market : 2010-12
Recovery of the markets to a large extent with strong growth in Asia
Start of major patent expiries
M&A activity down in the West but could be important in Asia, restructuring will continue
Asia becoming increasingly important as a market and outsourcing hub
5Ps to drive market: Preventive, Preemptive, Personalized, Predictive, Personal Responsibility
Source: Frost & Sullivan.
Global vs. APAC: The New Frontier By 2012 APAC expected to be close to 27% of global market Source: Frost & Sullilvan ,2010 ) 23.9% 27.2% 23.2% 26.4% CAGR 12.2% CAGR 6.47%
By 2015 APAC could represent ~40% of global market!
Source: Frost & Sullivan Rest of the World APAC Global & APAC Healthcare Revenues US$ Bn, 2009-2012
Asia is however transitioning Moving toward a Multi–Polar World Order Source: Frost & Sullilvan ,2010 ) Asia Pacific Market : 2009
Slowing down of GDP in mature markets – Japan and Australia took a big hit
Global consolidation left a difficult mess for integration on a local level – job losses and portfolio realignment
Price cutting and playing the margins game
The bubble burst for Medical Tourism
Asia started to set up infrastructure for offshoring and outsourcing for US/EU companies
Asia Pacific Market : 2012
A shift in the center of the world economically and strategically to Asia
Asia to move from export led development to consumption led growth
APAC the fastest growing pharma market and API production hub
Increased government attention to primary and community based healthcare .
Increased use of mobile technology in healthcare service delivery
2010 : Malaysia Innovation and Creativity year
Source: Frost & Sullivan.
Aged Population , 65+ cohort is more than 20% (2008) Japan Household Financial Assets ~ US $ 16 Trillion (Sept. 2009) ** *Source MHLW, METI Source: Diabetes Australia Japan-Aging Society, Increased Economic Wealth Seizing Growth Opportunity in a deflationary environment WATAMI GROUP COMMONS 30 FUND
Source: Frost & Sullivan. Patient Adherence (Role of New Therapies) Re-imbursement based On value (Role of cost-effective devices) Provider focus in under-served areas ( Role of IT) Japan Healthcare Industry –SWOT Analyses Emerging Paradigms
Universal Mandatory Insurance
Healthcare expenditure lower
compared to OECD countries
Highly developed infrastructure
and well trained & dedicated medical staff
Focus on short term cost constraint rather
than value for patients
Duplication and fragmentation of services
-Multi tiered distribution system
Slow registration/approval process
Rapidly Aging Population
Increasing economic wealth
Low custom duties/tariffs
Inadequate services in rural areas
Inefficient Physician usage
Dependency on imports slows down
Failure to adopt locally developed
principles like TQM
Weaknesses Strengths Opportunities Threats
In-depth Sectoral Analysis, APAC and South Korea
APAC Pharmaceuticals Market Earlier diagnosis improves disease management and length of therapy Note: All figures are rounded; the base year is 2009. Source: Frost and Sullivan Market Drivers Market Restraints
Long term use of multiple and specialized drugs for the ageing population
Government support for generics and biosimilars
Enhanced diagnosis and management in oncology, cardiovascular, pain etc
Cardiovascular disorders, alimentary canal & metabolism and general anti-infectives remained the top selling therapeutic categories in Japan, registering 2008 sales of $14.6bn, $9.6bn and $6.5bn respectively.
Prevalence of diabetes : 2010 : ~8 mn. Potential for diagnosis and treatment as nearly 20% of cases are undiagnosed
Bio-pharmaceuticals, Vaccines Cardiovascular and metabolic diseases, Generics Oncology
Japan Oncology market in 2009 : ~ US$ 1 0 Billion; CAGR ~ 14-15%
Growth from early diagnosis of cancers and specialised therapies
Targeted therapies (Avastin etc)
Adjuvant therapies (Xeloda etc)
Supportive therapies (Neutrogin etc)
Top Growth Opportunities : Japan Pharmaceuticals and Biotech Market
2009 : biopharmaceuticals identified as a growth engine for the Japanese pharma sector. Targeted therapies and antineoplastics & immunomodulating agents are expected to record the highest growth with CAGR of 19.8% and 10.1%, respectively, over the forecast period.
Somatropin BS formed the first biosimilar to launch in Japan. Cervarix, Prevenar and Januvia formed the most awaited vaccine drugs to receive Japanese approval in 2009.
Vaccines offer tremendous potential (MMR, Inactivated Polio, Rotavirus). 4% of global sales.
Source: Frost & Sullivan.
APAC Medical Equipment Market Transition to a mindset of monitoring 59.4 65.4 72.0 79.4 Note: All figures are rounded; the base year is 2009. Source: Frost and Sullivan Market Drivers
Safety, accuracy, efficiency, cost
Automation and integration with information systems
Emphasis on early detection and monitoring
Silver industry requirements
Regulatory and reimbursement hurdles
Inadequate distribution networks
Inadequate training on and compliance to new technology
Source: Frost & Sullivan. Medical Equipment Revenues, US$ Bn, 2009-2012
Japan Medical Equipment Market Focus on technology that provides integrated medical care Medical Equipment Revenues, US$ Bn, 2009-2012 Market Drivers Market Restraints
Demand for advanced and innovative medical equipment
Increased prevalence of chronic and lifestyle diseases
Increasing Funding Gap (~US$ 200 Billion by 2020?)
Strong reliance on imports in relation to domestic manufacture
Demand for Orthopedic, Gastro-intestinal, Urology, Cardiovascular, Neurosurgery and Pulmonary devices is being driven by increased prevalence of chronic and age related diseases .
Demand for devices used in ICU and related departments is growing at a slower place (bed penetration is less than 1%)
Increased demand for POCT and laboratory automation products
Demand for Diabetes management tests, HbA1c, heart failure detection BNP, including NT-proBNP and lipid metabolism management index LDL-C has been increasing steadily. Influenza test kit was in enormous demand in 2009
Demand for personalized medicine/testing has started to ramp up
Note: All figures are rounded; the base year is 2009. Source: Frost and Sullivan *Healthcare IT includes: Software, Hardware, IT services and Lifesciences IT Asia Pacific Lifesciences and Health IT Market* Interoperability challenges hinder adoption Market Drivers Market Restraints
Strong and sustained demand for healthcare services
Consumer demand for quality and access to information
Growing demand for patient centered healthcare services and systemized healthcare organization management through the implementation of advanced healthcare systems
Japan market 2010 ( Outreach and Remote care delivery: Home Health and Tele-Medicine/Tele-Health) : ~US$ 134 mn; CAGR ~2%
The popularity of this segment can be contributed to the aging population, lack of hospital bed capacity and the increased need for home care for patients with chronic conditions. The country is also encouraging initiatives to increase communication between physician, pharmacies and patient for delivery of orders, prescriptions and payment.
Japan is moving towards a government-centered EHR system. The installation of EHR systems, especially for clinical use such as medical digital imaging reference functions are increasing in clinics and hospitals.
Summary : Best Opportunity Analysis APAC and South Korea
Where to place your bets in Japan : 2010- 2012 Source: Frost & Sullivan. Advanced Image Processing Surgical Planning Oncology Drugs Time Growth Generics Personalised Testing EMR/EHR Medical Imaging (CRA, MRA etc) INNOVATION TRIGGER SUPER GROWTH NORMALISATION LEADERSHIP Vaccines General Surgery Cardiovascular Drugs
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