Navigating Reimbursed Markets in Asia-Pacific

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Navigating Reimbursed Markets in Asia-Pacific
An audio interview with Jan-Willem Eleveld, IMS Vice President,
Management Consulting, APAC
AUDIO INTERVIEW!
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Navigating Reimbursed Markets in Asia-Pacific
IMS Expert: Jan-Willem Eleveld
Length: ~11:30 minutes
Jan-Willem Eleveld
To download an MP3 of this interview, click here.
To download the PDF transcript, click here.
Questions? Comments? Fill out the form at the end of this presentation.

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I guess we should start by clarifying what we mean by
reimbursed markets?
Jan-Willem Eleveld (JE): Okay. IMS defines a reimbursed
market as a market where access to healthcare is provided by
a single payer, usually the government. In these markets,
everyone has access to healthcare which is funded through
the government. In the Asia-Pacific region, these markets
include primarily Korea, Taiwan and Australia.

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I see. So if there are only three countries in the region
that are reimbursed markets, how would IMS define the
rest?
JE: Basically, most other countries in Asia are still defined as
out of pocket markets, as well as hybrid markets. These
markets include some combination of government-funded and
privately-funded healthcare. For example, India, Indonesia
and the Philippines are Out of Pocket markets while China,
Thailand and Malaysia are hybrid markets, with increasing
levels of reimbursement for essential drugs.
Know more on IMS Health, click here

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That’s interesting. So can all markets, reimbursed, out of
pocket and hybrids be approached the same way?
JE: No, they really cannot, and that has been a common
misconception and the reason for so many failed launches in
the past. Each market has to be handled differently, and the
approach to each market almost customized.

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So each launch has to be handled differently?
JE: Definitely. The launch environment is much harsher today
than it was say even three years ago. Our market insights
and work with a large variety of clients suggest an updated
approach to priorities and new commercial models that are
driving launch success in both reimbursed and non-
reimbursed, as well as hybrid markets.

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So they need to be handled differently, in what way?
JE: Well, firstly, products have to be on the list of approved
medicines for reimbursement or they will find it very hard to
compete. To get on this list, the product has to be proven
safe and effective, but also must prove its value compared to
existing alternatives. In Australia and Korea, for example,
proof must be provided upon submission of a company’s
application to be listed, including pharmacoeconomics data.

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And is it the same for Taiwan?
JE: Taiwan is the same in that a reimbursement price has to be
negotiated with the government. However, the process is still
less sophisticated and less regulated than in Korea and
Australia.
I see. So having gotten on the list, what else should
companies consider to increase their competitiveness?
JE: It’s not just getting on the list that matters, but also getting
the most appropriate reimbursement conditions. We’ve seen
how local payers and regulators are playing an ever increasing
role in the success or failure of products coming to the market.

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What makes a successful launch?
JE: Well, successful launches are powered by compelling
demonstrations of value which are drawn from well-planned
trial programs. The failure to strike the right balance between
regulatory requirements and payer concerns can undoubtedly
hinder a launch. For instance, payers are looking for
improvement in overall survival rates for new oncology drugs
and will decline reimbursement with less convincing endpoints.

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That’s an interesting point. What do you mean the most
appropriate reimbursement conditions?
JE: Companies need to make sure they will get the maximum
reimbursement relevant to the approved indication of the
drug. In our most current launch analysis of the region, we
see how gaining advocacy, approval and market access
requires a powerful value proposition that appeals to both
payers and regulators.

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How is that achieved?
JE: Well, it increasingly means meeting disparate – and
possibly contradictory – needs. A product may get on the
reimbursement list for treatment of just one indication even
though its efficacy is recognized for multiple indications. Or it
may get listed for reimbursement for one year of treatment
only, while the patient would need to take the product for
many years. So, there is a complex set of options companies
need to invest need to work through.

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So success in obtaining the best possible reimbursement
can determine the success of the product in the market.
JE: Absolutely. Once reimbursed, it usually supports a faster
uptake of the product compared to out-of-pocket markets. In
our latest Launch Excellence work, we identified five key
drivers of uptake that critically build market share and
maximize brand performance.

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OK. Let’s break the down one by one.
JE: Well, the first would be achieving brand advocacy among
key stakeholders – regulators, payers, key opinion leaders,
prescribers and patients with an early focus on creating the
right value proposition.
OK
JE: The second is gaining brand approval at a regulatory level
with optimal positioning and labelling for the right patients.
Right.

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JE: Thirdly they need to secure market access on the right
terms with national and sub national payers.
The fourth step is to attain brand adoption for the optimal
patient segments with a focus on working with prescribers
and providers to achieve early strong positioning.
And the fifth?
JE: That would be to ensure brand adherence by retaining
patients as loyal repeaters for as long as clinically possible.
These key drivers in fact are not different in the Asia Pacific
reimbursed markets compared to the European markets.

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Yes, I can see that these five elements are basic across
all geographies and markets. But coming back again to
addressing price issues specifically in relation to non-
reimbursed markets, which are fragmented, you have to
keep renegotiating your price I suppose.
JE: That’s correct. Mind you, in both markets, you still have
to convince doctors to prescribe the products. But at least in
reimbursed markets, negotiation on price only has to happen
once, so it’s half the battle won.

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JE: APAC is an emerging region so the healthcare landscape
is under constant development. It is still a relatively young
market, and most countries in the region are on the path to
becoming reimbursed markets in some form or another,
mostly because of the importance of providing affordable and
accessible healthcare for all on each government’s political
agenda.
I’m surprised there are only three countries that are
reimbursed markets in APAC. Why not more?

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Yes, I suppose that makes sense. So going into the
reimbursement markets of Australia, Korea and Taiwan,
what should pharmaceutical companies be doing to
optimise success in these markets?
JE: Well, as I said before, there is a growing trend for launch
success to be more driven by gaining payer acceptance than
individual prescriber adoption. Successful launches are
powered by demonstrations of value, so companies need to
engage stakeholders earlier in the game and before the actual
launch of their product. They need to understand the
dynamics of each of those individual market where they plan
to launch.

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So once the product is on the reimbursement list, is it
pretty much guaranteed that the market is secure?
JE: Not at all. And that’s also a crucial point. Once companies
have their products on the reimbursed medicines list, they
still need to convince healthcare professionals when and
where to use the particular product so as to ensure it
continues to expand in market share. To do this, they need
to explain the science behind the molecule to the physician
and patient to familiarize them with the brand and to get
them comfortable with prescribing it and taking the drug.

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So building the connection directly with patients is an
important strategy?
JE: Absolutely. But not just the patients. They need to
encourage brand loyalty among doctors, too.
So, on the subject of brand loyalty and defending the
brand in the face of competition, am I right in thinking
that these three reimbursed markets have strong local
generics markets?
JE: Yes, they do. Although the majority of the value of each
market is still driven by patented or original brands.

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Will that impact the product life cycle of pharmaceuticals
on the approved reimbursement list at all?
JE: To a different degree and in different countries, it will.
Australia has quite an advanced generics market, so upon
patent expiry, the generic products tend to take over.
However, in Korea and Taiwan the situation is different. In
those markets, generics sell at very high prices, up to 80% of
the originals, so there is little price gain between originals and
their generic equivalents. The local generics companies have
strong profits as they have virtually no research costs
involved. As a consequence, there is no real financial
incentive for the local industry to change much.

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I see. So how do pharmas compete effectively once
patents expire?
JE: They need to decide where their products sit in these
markets. Often they can trade off old products to get new
ones on the approved list. The danger is for companies to be
short-sighted and look only at one particular product. They
need to be putting themselves in the buyer’s shoes. Buyers
will be looking at the company’s whole portfolio rather than
one isolated product, and will make buying decisions on a
more macro level.

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So what assistance can pharmas expect from IMS when
launching in reimbursed markets?
JE: Well, IMS is well positioned to help MNCs, or multinational
pharmaceutical companies, avoid common pitfalls in these
markets. We are present in nearly all Asian countries and
employ more than 220 consultants – all of whom have deep
market experience and can help a company determine how to
best optimise their value proposition, and effectively and
efficiently engage stakeholders. We also map out resource
allocation, and monitor and drive performance, as well as
align and prepare these organisations for launch.

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Thank you for listening!
• To download an MP3 of this interview, click here.
• To download the PDF transcript, click here.
• Questions? Comments?
− Fill out the form at the bottom of this slide, or
− Visit www.imshealth.com or email info.sg@sg.imshealth.com.

Navigating Reimbursed Markets in Asia-Pacific

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