Healthcare Need & Commercial Opportunity Emerging Markets

Need State of the art care for the few? Basic care for everyone? Quality essential care for everyone?

State of the art care for the few?

Basic care for everyone?

Quality essential care for everyone?

Needs BRICs Diabetes, cardiovascualar, anti infectives, vaccines Developing World Vitamin A, parasite control, malaria, insecticides, reproductive health

BRICs

Diabetes, cardiovascualar, anti infectives, vaccines

Developing World

Vitamin A, parasite control, malaria, insecticides, reproductive health

The Objective Equitable access Social cohesion Affordable care Appropriate price and cost Sustainability Balance between best care for all and efficient optimisation of care

Equitable access

Social cohesion

Affordable care

Appropriate price and cost

Sustainability

Balance between best care for all and efficient optimisation of care

Healthcare System Design Complex systems in government hands Efficient? Cost effective? Role of the Private Sector Cost efficiency Allocation of resources Insurance model

Complex systems in government hands

Efficient?

Cost effective?

Role of the Private Sector

Cost efficiency

Allocation of resources

Insurance model

Commercial Opportunity IMS Health Emerging Markets Forecast 12% growth By 2020 30% of Global Pharma Sales 50% of Global Pharma Sales Growth China drug spend $15 per person per year, US $950

IMS Health Emerging Markets Forecast

12% growth

By 2020 30% of Global Pharma Sales

50% of Global Pharma Sales Growth

China drug spend $15 per person per year, US $950

Global Pharma Sales Growth Forecasts

Recent Developments Big Pharma looking for growth GSK new senior Executive Pfizer major part of new strategy Sanofi new markets for ex branded drugs J&J referenced need for Emerging markets appropriate products

Big Pharma looking for growth

GSK new senior Executive

Pfizer major part of new strategy

Sanofi new markets for ex branded drugs

J&J referenced need for

Emerging markets appropriate products

Issues Access Reimbursement IP respect Corruption

Access

Reimbursement

IP respect

Corruption

Access Marginal price should equal Margin willingness to pay, but In different countries willingness to pay is dramatically different Universal Global Pricing denies access to enormous numbers of patients Should there be Tiered Pricing?

Marginal price should equal Margin willingness to pay, but

In different countries willingness to pay is dramatically different

Universal Global Pricing denies access to enormous numbers of patients

Should there be Tiered Pricing?

Producer Revenue Price Quantity Demand Curve Efficiency Loss

Price Quantity Demand Curve Efficiency Loss Producer Revenue

Current drug access No/limited access People Price Access?

Reimbursement Reimbursement system will determine access and cost parameters Fundamental problem with buyer knowledge in healthcare markets Managed Care as the informed pricing agent Government buyers e.g. UK’s not so nice NICE

Reimbursement system will determine access and cost parameters

Fundamental problem with buyer knowledge in healthcare markets

Managed Care as the informed pricing agent

Government buyers e.g. UK’s not so nice NICE

IP Lack of IP enforcement IP underpins the innovation model Investment is unattractive Multinationals may not participate R&D cross fertilisation is inhibited

Lack of IP enforcement

IP underpins the innovation model

Investment is unattractive

Multinationals may not participate

R&D cross fertilisation is inhibited

Corruption Negative relationship between economic development and corruption Positive relationship between multinational penetration and lower corruption High human cost of fake drugs 30% of drugs in government hospitals in India are counterfeit, 60% of which have no active ingredient

Negative relationship between economic development and corruption

Positive relationship between multinational penetration and lower corruption

High human cost of fake drugs

30% of drugs in government hospitals in India are counterfeit, 60% of which have no active ingredient

Other Opportunties Outsourcing R&D and Manufacturing well underway Services Offshoring R&D internalisation The long game Medical Tourism $160bn market by 2012 per The Economist

Outsourcing R&D and Manufacturing

well underway

Services Offshoring

R&D internalisation

The long game

Medical Tourism

$160bn market by 2012 per The Economist