2. 2
Health Sector Review Framework
Presentation Agenda
01
02
03
04
Iran Overview
Iran holds the potential for yet another breakthrough
that will again be a model for its global neighbors
Iran Pharmaceutical Environment
The pharmaceutical sector must rethink its current
scheme of subsidy
Iran MOH regulation
Registration, Pricing, Importation , Reimbursement
Current Vs Future
The Government of Iran will need to invest strategically for the
future, both in terms of material inputs (drug manufacturing),and in
Regulation of Pharma Market .
3. 3
Iran Overview
79 Million population
GDP : 415 b USD
GDP Per Capita: 4,763 USD
Health Exp. : 6%
Pharma CAGR 5Y: 24%
8 million >60 YRS
16 million Obesity
168
124
18 million HTN
45000 Dies by cancer
120 Medicine Importer
36 API Producer
53 Local Distributor
(80% by 10)
98 Pharma Local Producer
53%
.
47%
2ndlargestnationin theMiddle East-geographicallycovering1,648,195km2(18th largestin theworld)
strongruralPrimaryHealth Care(PHC).
Iranholds 10%of the world'scurrentoil reserves andhasthe world'ssecondlargestreservesof naturalgas(15% ofthe world'stotal)
96122 Active Bed
60K Active Physician
73 YRS life expectancy
1.4 new born baby
9 million Diabetes
4. 4
2015
Iran Macro Today
PESTEL
Analysis
POLITICAL
Iran and 5+1 agreement on 2015
Political violence in Middle east
Rouhani in Presidential elections in June 2013 is leading to a
gradual improvement in relations with the West.
ECONOMICAL
Inflation rate is decreasing dramatically and is on 14%
Growth rate is 1.50%. GDP per capita is 4,7637 USD
18th largest economy purchasing power parity
Iran is 21th market in world
Health Expenditure: 6% of GDP
TECHNOLOGY
There are over 98 pharmaceutical manufacturer
operating in Iran
Poor R&D activity
Few manufacture licensed by GMP
Manufactures almost import API from india
LEGAL
IDL list entering (Big Obstacle)
4% tax, complicated regulation of MOH,
Brand & price restrictions, 4% tariffs, and
IRC code ( Medium)
Pricing committee ( Great Challenge)
Importation permission
Reimbursement
ENVIRONMENT
Growth is shifting from primary care to specialty care area
Enforcing good manufacturing practice GMP rules has increased
go to market launch timelines
An important new increased stakeholder has emerged in the
form of the family physician FP requiring pharma companies to
adjust their go-to market approach
SOCIAL
Population Growth Rate: 1.2%
6 million over 65 years old
Total adult population (20-79 years) : 51,145.45(1000s)
Number of deaths in adults due to diabetes : 38,002 per Y
Prevalence of diabetes in adults (20-79 years) (8.43 %)
1% incidence of Diabetes
Total cases of adults (20-79 years) with diabetes :4,395.93 (1000s
5. 5
From Privatization to open Market
Iran Pharma History
2000 2002 2006 2012 2015
Privatization
The government is the
owner of a big part of the
healthcare facilities of the
country. It is also the main
purchaser of the
healthcare services and
goods by providing credits
for health insurance
organizations
First Importation
another step was to allow the
few private sector to set up one-
off-prescription (single-permit)
centers in winter 2002 .
Shafayab ,Coble
.Behestan,Akbarieh
Iran Focus on
Generic Export
Iran supply generic
Access to other regional
markets: Iran is located at the
heart of three regions -
Central Asia and the Caucasus,
the East Mediterranean, and
the Middle-East.
Financial Sanction
The latest financial sanctions
could have a major impact on
pharmaceutical trade if the lack
of payment for medicines stops
companies from importing
pharmaceuticals to Iran.
After Sanction
How Future will be
changed after sanction
lifting ?
Health Transformation Plan;
a large portion of the income
derived from
subsidies and %1 of value
added tax have been
allocated for health sector.
Access to UHC has been the
common goal of all these
steps
6. 6
Economic, political, Healthcare, Regulation, Agreement
Pharma Macro environment
Iran Health Expenditure
Iran holds 10% of the world's current oil
reserves and has the world's second largest
reserves of natural gas (15% of the world's total
6% HEALTH EXPENDITURE.
Sanction
“Resolution 1696” and imposed
economics sanctions after Iran refused
to suspend its uranium enrichment
program - this have affected the
economy and led to a steep fall in the
value of the Iranian rial & MADE GREAT
Inflation (30 %).
Public Health Care System
The Government is playing a key
role in regulating the development
of Health system .
Pharma Regulation
The National Regulatory Authority (NRA)
which works under the umbrella of the
MOHME is responsible for establishing
quality standards for regulation of all
medicinal products in Iran and is main
decision maker of registration and
pricing of medicines in Iran.
Iran & 5+1 agreement
The embargo has slowed down the economy,
but agreement are going to make growth, and
if the trade restrictions lifted …
7. 7
Payer and policy maker in Iran
Pharma Stakeholders in Iran
Pharmacies
Front line of sales.
Bio Pharma
Supplying Goods. Document for
finished goods .
Physician
Provider
.
Importer
Ma holder facilitating registration
and transaction .
Distributor
Dispensing among pharmacies
Food And Drug Organization
IDL/IRC/Pricing/Import permission .
Ministry of Welfare and
Social Security
Reimbursement
.
8. 8
Medicine consumption of Iran Vs population growth
Medicine consumption in Iran Vs Global
Iran population Growth
• World population growth is 4 %
• Iran population Growth is 8%
• Iran medicine consumption is less than global .
• Spain ,Greece ,Turkey negative growth
• Iran,Thailand,Suadia arabia growth is positive
Cost of medicine importation per person in one month$1
Iran pharma market in 2014
$4380M
Imported medicine per person in Iran$12.8
799
861
852 872
929
-
100
200
300
400
500
600
700
800
900
1,000
-
5
10
15
20
25
2010 2011 2012 2013 2014
BillionDolor
جهان ترکیه تایلند
یونان سعودی عربستان ایران
اسپانیا
Turkey Thailand
IranSaudi Arabia
World
Greece
Spain
9. 9
Turkey is 2 times in value and 1.5 times in volume bigger than Iran pharma
Medicine consumption in Iran Vs Global average
Value Volume
446
98
56 128
0
50
100
150
200
250
300
350
400
450
500
کشورها جهانی متوسط
Iran
Venezuela
Thailand
S-Arabia
Russia
Turkey
Greece
Spain
Lebenan
Algeria
Malaysia
Global AverageCountries
3.5 X
0.43 X0.8 X
1161
741
515
392
0
200
400
600
800
1,000
1,200
1,400
کشورها جهانی متوسط
3 X
1.3 X
1.9 X
Iran
Venezuela
Thailand
S-Arabia
Russia
Turkey
Greece
Spain
Lebenan
Algeria
Malaysia
Countries Global Average
18. 18
Pharmaceutical markets Development in Provinces
Health System Development in provinces
0
20
40
60
80
100
Urmia shiraz Tabriz Mashhad Esfehan Tehran
55 60
70
85 90
100
Development Level
The pharmaceuticals management function generally scored well.
The procurement component appeared to be the only weak area of
pharmaceutical management in Iran . The other components of
pharmaceutical management, including budget, financing for drugs,
pharmaceutical policies and accessibility to good quality products
and services, all had fairly good profiles in main big cities . The
weaker profiles were for rational use of drugs, and storage and
distribution aspects in Iran .
40%
70%
85%
20%
100%
55%
40%
70%
60%
20%
90%
40%
20%
The1 THE health systems assessment tool was modified by the Health transformation plan team.
40%
20. 20
Drug Registration Process in Iran
IDL(Iran Drug List)
Start
The applicant submit an application to FDO
IRC(Iran Registeration Code)
Finish
The end of drug registry by getting unique IRC
code, entrance to the Iran Pharma market
FORM Number 1
Pharmaco Economic Files
Price proposal
Having Reference of France, Spain, Italy,
Turkey and Greece and original country
45 Days
Committee secreter
Required Documents :
Just verify the documentation
60 days
Pharmacoeconomics
Evaluation
30 Days
Committee waiting List
1-12 Months
Our core value is to change
it to One Months
Subcommite
Head of Therapeutic
area association
The Actuary
60 Days
IDSEC
Last step-Final Approval
1 Month
Price Approval
Getting Price approval before getting
IRC number
Technical commitee
Legal committe
Price Commitee
Having price of France, Spain, Italy,
Turkey and Greece and original country
Preliminary agreement
Required Documents :
1. LOA
2. CCP
3. DIAF
4. GMP
IRC registeration
The Dossier should preferably
be presented in CTD format
Registration fee:
+ 65,000,000 Rial
Day will pay for registration
MOH evaluation
DAY value is to
shorten this step
Iran Drug List – 24 Months
21. 21
From agreement to patients
Importation process
Business
Case
Originator Ministry Of health Supply chain Omid Darou Salamat Dedicated BU
LOA
Documentation
IDL
Triple
Pricing
MOH
Approval IRC
CPTPRICE
Permission
toimport
AfterDistributor warehouse
IfneededGoodstransfertolab
Labeling
COMPANY
Distributor
warehouse
Interactivity
OfS&M
Server&
Database
ProductLunch
Scientific
Communication
AccelerateAdoption
& Adherence
Proveproduct
value
IntegratedChannel
Management
Patient Engagement Services
(patientknowledge)
Patient
Usepills
Shipment
Pricing
Placeourorderfor
Supplier(PO)
TransactionDown paymentsorbanking
Clearance
permission
production
COA Certificateofanalysis+invoice+packingList+COO
CustomClearancePermission
AfterpayingTaxandDuties
ReleasetothemarketafterTM approval
ReceivePIfrom
supplier
Production lead time
22. 22
Submitting new molecule in Iran pharmacopeia
IDL Project Timelines -12 Months
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
30 Days
80 Days
60 Days
90 Days
60 Days
30 Days
Submitting the Form Number 1
Milestone 1
Submitting the File Milestone 3
Subcommittee
Milestone 5
Pharmaco documentation
Milestone 6
Pharmaco approval
Milestone 8
IDES approval
Milestone 2
NDC committee approval
Milestone 4
Subcommittee N/Y
Milestone 7
Subcommittee approval
Start / End
Start / End
Start / End
Start / End
Start / End
Start / End
Filing to Committee secretary 2
Sub committee preparation 3
Pharmaco economic 4
Subcommittee approval 5
IDES committee 6
23. 23
What is the Turkey approval price
Pricing Mechanism
Drug Pricing is the main strategy objective of FDO 2015
Does Local Generics available ?
1st
2nd
does it Brand ?
3rth
Ministry of health
Weighting the MOH Price concerns
For imported Brand products
Does it have Superiority in
pharmacoeconomic
4rth
Does Imported generic available ?
5th
Landing Cost
13%
Importer Margin
8-13%
CPT Price Distribution
10%
Pharmacy
15%
pharmaceutical
Mark up
Less
than
30
euro
more
than 30
euro
Custom Tax (foreign produced
products)
4.5% 4.5%
Custom tax( locally produced
products)
32% 32%
Regulatory clearance/etc.
expenses
4% 4%
Importers profit 8%-13% 8% - 13%
Distributor profits 10% 5%
Pharmacy profit 15% 10%
+
+
+
24. 24
Is under coverage of
reimbursement
Reimbursement
Three major Organization
SSO
MSIO
Military
insurance
The Social Security Organization
(SSO):
Generally, 7 million insured persons as well as
1,300,000 old-age pensioners are covered by
the SSO; meanwhile, considering the family
members and dependents of the major
insured individuals, totally, the covered
population by the SSO who receives insurance
and medical services is about 27.5 million
persons.
The Medical Service Insurance
Organization (MSIO):
MSIO provides health insurance for
government employees, students, and rural
dwellers. The rural population not covered by
any other insurance plan were entitled to
receive benefits at will in 2000. Patients are
subject to copayment at the point of service.
The Military Personnel
Insurance Organization &
Imam Khomeini
Provides health insurance for military
personnel
90% of
Iranian
10 steps to entitle Drugs
in reimbursement List
Approximately
12 Months(trulicity)
Board of
government
-Insurance
committe
FDOConsumer
protection
SSO MSIO MPIO IMAM
Supreme
Council of Ins
Health
Minister
Minister
of Social
Welfare
4Months(insulin)
IDL IRC POS INS
25. 25
Pharma
Current & Future
Iran Environment
• Political,
• Economic,
• Technology
• .
Pharma regulation :
• More competition
• More regulation to ….
Future
Iran’s pharmaceutical industry has been one of
the country’s most prosperous sectors over the
past years. The sector, accounting for 3.18% of
Tehran Stock Exchange’s overall value, is
considered one of the most important groups in
the 37 industries active in TSE. And …
Current
Pestle slide 6.
http://financialtribune.com/articles/economy-business-and-markets/22813/pharmaceutical-sector-faces-bright-future
26. 26
WHO WILL WIN IN THE IRANIAN PHARMA 2020
How will the health care system and the pharmaceutical market
develop from sanctions are lifted until 2020?
OPEN FOR BUSINESS
US) MNCs entering Iran
MNCs activities
MNC will their (Affiliates)
Local pharmaceutical investment
MNCs without presence of importers
New products submissions.
REGULATORY ENVIRONMENT
Mid term WTO agreement and IP
Ethical Guidelines & Legislation
Quality requirements for manufacturing & distribution
Technology for product tracking
More restriction to direct MNC to produce goods locally
SUSTAINABLE HEALTH CARE SYSTEM
(Mid-Long Term)
As the costs increases, private insurance will
emerge to balance health care budget
More restrictions on new product registration,
i.e. Health Economic models
More restrictions on reimbursement
Compulsory national treatment guidelines
ECONOMICAL GROWTH
Health Care budgets will be fueled by Government
Affordability of patients for co-pay or cash pay
Reimbursement levels
.
Editor's Notes
The first pharmaceutical manufacturing facility was built in Iran in 1953, and grew to 40 over the 25 year period to the Iranian revolution. In 1964 foreign pharmaceutical companies were allowed to set up local subsidiaries and manufacturing. After the Revolution the Iranian government introduced the Generic Scheme targeting modernization, but with a heavily subsidized state pharmaceutical industries. This subsidization lead to an unsustainable low cost level that hindered further development and investment .
Towards the end of the First Five Year Plan (1990–1995) the government began to allow private investment in the pharmaceutical sector.
The Third Five Year Plan (2000–2005) reduced the government’s authority in the pharma industry. It established two categories of medicines 1) essential drugs which the government would procure through low-priced foreign exchange and direct subsidies, and 2) non-essential drugs which would be manufactured with API from international suppliers with some freedom to selecting suppliers, manufacturing higher quality products and setting their own prices within a base and ceiling price set by the government.
Within the Third Five Year Plan, the importation of branded non-essential medicines by the private sector was also legalized as was the right to market domestically manufactured products under their own brand or trade labels rather than the previous requirement to market identical products under the recognized generic name
Today, the majority of the Iranian producers are now privatized and actively trading in the stock
exchange. The key players produce pharmaceuticals according to international standards .