2014 APAC Consumer Health SMR Summary by IMS Health

APAC OTC Market Trends Report
Anthony Morton-Small, Senior Principal, IMS Health
December 2014

AGENDA
• Global OTC Market Context
• APAC OTC Insights
• Summaryy
APAC SMR December 2014
2

GlobalWhile Pharma experiences a number of constraints,
OTC benefits from a range of growth drivers.
Top Corps contribution to growth
f lli idl
Low number and quality output from
R&Dfalling rapidly R&D
Generics dominating large
therapy areas
Demand constrained by
payers
PHARMA
Emerging markets have the critical mass to
influence growth
OTC
Key players building strong brand
identities
Payers keen to promote self
medication
g
Companies seek to exploit switch
opportunities
Increasing access through new
channels
3
identities medication

The Traditional Consumer Health Segments comprise:
OTC, Personal Care, Patient Care and Nutrition.
Global
OTC
Over The Counter
PEC
Personal Care
PAC
Patient Care
NTR
Nutrition
• Registered and
unregistered products
• Pure OTC/ Pharmacy
• Products for beauty
and hygiene
• Examples: Emollients,
• Examples: Test and
measurement
instruments, wound
care, stoma care,
• Examples: Infant and
adult formulas,
slimming aids,
diabetic food,
(and other channels)
• Examples: Cough/
cold, pain, digestive,
vitamins and minerals,
etc
face and hair care,
fragrances, oral
hygiene
contact lens care, etc. nutritional products,
etc.
etc.
$114bn* $237bn* $12bn* $222bn*
* IMS Estimation
4

GlobalHowever the shift of focus towards health & wellness
has led to new transversal market segments.
Blurring the boundaries (or broadening the scope!) and attracting
new competitors
Pharma-ceuticals NutraceuticalsCosmeceuticals
Topically applied Provides medical or health
benefits including
Vitamins, herbs, various oils,
and botanical extracts
typically added
May not claim drug-like or
benefits, including
the prevention and/or
treatment of a disease
Typically sold in the medicinal
form of capsule, tablet,
NutritionPersonal Care
y g
therapeutic effects
p , ,
powder, solution
Sometimes associated with
functional foods
Nutricosmetics Ingestible. Containing ingredients such as
botanical actives, enzymes, proteins, and
vitamins
5
vitamins.
Marketed specifically as beauty aids

As OTC becomes increasingly attractive, industry
players become more diverse.
Global
Pharma
Consumer
Health
FMCG/CPG
Consumer packagedConsumer packaged
goods
Pharma moving into
consumer health
CPG moving into
consumer health
Pure play
consumer health
• Payer and generic
pressure driving
diversification
• Rx to OTC asset leverage
• Broader patient/consumer
• Higher consumer health
margin and prices
• Leverage consumer and
trade marketing muscle
• Lower private label
• Leverage sales and
marketing capabilities
• Economies of scale in
supply chain
• Leverage consumer• Broader patient/consumer
healthcare coverage
• Lower private label
competition
• Leverage consumer
understanding
6

OTC continues to show healthy growth, while Pharma
growth improves.
Global
14%
16%
14.0
16.0
Year on Year Value Growth & OTC Share of Total Pharma
Data for MAT to Q2 2014
Total Pharma = $ 1024 bn
9.4
10.6% 10.4% 10.3% 10.1% 10.2% 10.4% 10.4% 10.7% 10.7%
11.2%
10.9%
10%
12%
10.0
12.0
(%)
Total OTC = $ 111 bn
7.3
6.4
6.8
5.2
5.5
6.2
7.7
6.0
5.4
6.3
7.0 7.0 6.9
6.1
6%
8%
6.0
8.0
ValueGrowth(
5
4.6
4.1
1.5
4.2
4.6 4.6 4.5
2%
4%
2.0
4.0
V
0%0.0
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Pharma Growth (%) OTC Growth (%) OTC Share of Total Pharma (%)
7
Source: IMS OTC audits plus estimates NB. Change in estimation methodology from 2014

GlobalEmerging Markets dominate the global OTC growth
contribution – led by LatAm, South Asia & China
20
OTC Growth by Region: Short vs Long term
Global 3 Year Average Growth 4.2%
L AMERICA
CHINA
SOUTH ASIA
15
owth(%)
CEE
CHINA
SE/N ASIA
5
10
testYearGro
Gl b l L Y G h 4 2%GLOBAL
W EUROPE
JAPAN AUSTRALASIA
0
5
La
Global Latest Year Growth 4.2%
N AMERICA
-5
-5 0 5 10 15 20
3 Years Average Growth (%)
8
Source: IMS OTC Global Analysis

GlobalDeveloped markets must innovate to drive growth,
whilst developing regions also see base sales growth.
Base Value Change 4 -16
Elements of Growth by Region – 5 Year Cumulative Growth %
-15
Price Change
New Products
Line Extensions 6
19
11
-9
12
12
5
13
6
Total Change 42 1
NORTH AMERICAWESTERN EUROPEGLOBAL
9
Base Value Change
Price Change
N P d t 38
2
70
22
-3
26
38
26
New Products
Line Extensions
Total Change 130
21
38
54
10
25
104
13
26
LATIN AMERICA APAC exc JAPANCEE
9

Top 10 Corporations Global OTC
Novartis continues to see strong growth, while RB and
Takeda also grow ahead of total market.
Global
4.0%J&J 2.1%
GLOBAL TOTAL OTC
+4.2%
Top 10 Corporations - Global OTC
Value Share & Latest Year Growth (%)
3.9%
3.8%
3 7%
NOVARTIS
SANOFI
BAYER
7.4%
4.1%
1 1%3.7%
2.7%
2.5%
BAYER
PFIZER
PGT
1.1%
0.4%
-0.5%
2.3%
2.2%
GSK
B.I.
-6.4%
2.3%
Value Share Value Growth > Market Value Growth < Market
2.1%
1.6%
RB
TAKEDA
4.8%
9.0%
10

GlobalTraditional Key Categories all match or exceed market
growth, except CCR, with a poor 2013-14 season.
Global OTC – Key Categories
Value Share (%)
Value Growth (%)
4.2%
TOTAL
MARKET
CCR
22.3%
OTHERS
20.0%
1.8%CCR
VMS &
VMS & TONICS
SKINCARE
9.2%
4.6%
5.4%
VMS &
TONICS
PAIN
RELIEF
18.5%
DIGESTIVE
14.5%
5.8%
5 4%
DIGESTIVE
PAIN RELIEF
15.5%
5.4%
4.2%
SKINCARE
OTHERS
Skincare includes Foot care
Others is dominated by TCM Eye Care Habit & Anti-Varicose
11
Others is dominated by TCM, Eye Care, Habit & Anti-Varicose

Localisation and market concentration help determine
the portfolio and business operation required to succeed
Global
Where to play and how to win?
Country segmentation • Localisation:
on
High
LatAm*
− Driven by local roots due to culture,
linguistic and medicinal habits
− Impact largely the portfolio (product
type, positioning & pricing)
oncentratio
edium
East EU
− Relevant to establish how to win?
• Market concentration
− Driven by urbanisation level and
Marketco
owMe
Asia Pac
MENA
pharmacy consolidation
− Impact largely the business
operation (commercial model to
adopt)
Low Medium High
Lo
MENA
The segmentation can vary within each
− Relevant to establish where to play?
12
Degree of localisation
g y
country depending on the CH category

AGENDA
• Summaryy
13

Growth in APAC comes from both innovation and base
value; while Global still relies heavily on price increases
APAC
Global OTC
5 Yr Growth = 42%
APAC excl. JP
5 Yr Growth = 130%
New
Products
Line
Extensions
21% NPD:
59%
fNPD:
19%
Price
Increase
Base Value
Growth
2%
38%
of
Total
Growth
NPD:
25%
of
Total
Growth
11%
6%
70%
4%
Contribution to Growth Contribution to Growth
14
Source: IMS Elements of Growth – Based on 5 year sales from 2009 - 2014

The more developed markets, show the potential for
growth in expenditure elsewhere in the region.
APAC
12%
11%
15.0%140
OTC EXPENDITURE per Capita ($) - APAC Countries
118
88
3%
9%
9%
5%
2%
11%
4%
5.0%
10.0%
100
120
nge(%)
88
45 39
0%
0% 0%
-4%
2%
-5 0%
0.0%
60
80
onYearChan
DOLLARS
28
25
15
12 10 9 8
2
12
-9%
-10.0%
5.0%
20
40
Yearo
D
2
-15.0%0
15

Average prices are rising in China, India and ASEAN but
flat or declining elsewhere
APAC
16

Country performances differ and local understanding
is critical to capitalizing on the opportunities.
APAC
SINGAPORE
20
wth(%)
APAC Growth by Country: Long vs Short term
APAC 3 Year Average Growth 4%
CHINA INDIA
MALAYSIA
HONG KONG
10
15
atestYearGrow JAPAN AUSTRALIA
SOUTH KOREA
INDONESIA
PHILIPPINES
0
5
La
APAC Latest Year Growth 4.4%
TAIWAN
-5
0
-20 -15 -10 -5 0 5 10 15 20 25
NEW ZEALAND
-15
-10
17
15

While VMS and Others (dominated by TCM) are the
largest categories, growth is driven by Pain Relief
APAC
Ski
4.4%Total OTC
APAC – Key Categories
Value Share (%)
Value Growth (%)
VMS & Tonics
25.9%
Digestive
12.2%
Skin
9.5%
4.4%
3.5%VMS & Tonics
25.9%
Pain Relief
12.3%
3.6%
4.9%
All Others
CCR
All Others
19.0%
CCR
21.2%
7.0%
4.0%
Pain Relief
Digestive
4.8%Skin
18

Among the smaller categories, TCM (in Other OTC) is the
key driver, while Habit (NRT) struggles, esp in Japan
APAC
APAC OTC – Minor Categories
Value Share (%)
Value Growth (%)
Habit
Anti-varicos
e
Antifungals
Weight
Loss
Ear
C
Anti-
haemorrhoids
4.0%
Habit
3.1%
e
1.8%
(Gyn)
1.4%
Loss
0.9%
Care
0.4% 3.6%
4.4%
All Others
Other OTC
Eye Care
19.6%
1.9%
0.7%
Eye Care
Anti-haemorrhoids
Other OTC
68.8%
2.6%
14.5%
Habit
Anti-varicose
-4.6%
-8.0%
Antifungals (Gyn)
Weight Loss
19
7.7%Ear Care

While VMS and Others (dominated by TCM) are the
largest categories, growth is driven by Pain Relief
APAC
8
9
wth(%)
APAC Growth by Category: Long vs Short term
APAC 3 Year Average Growth 4%
COUGH/COLD
PAIN RELIEF
6
7
atestYearGrow
DIGESTIVE
SKIN
4
5
La
APAC Latest Year Growth 4.4%
VMS
ALL OTHER
ALLERGY
2
3
1
0
1
-1 0 1 2 3 4 5 6 7 8
20
-1 3 Years Average Growth (%)
NB China 3Yr growth rate assumed to be the same as China 1 Yr growth rate

Among the smaller categories, TCM (in Other OTC) is
the key driver, while Habit (NRT) struggles, esp in Japan
APAC
15
20
owth(%)
APAC Growth by Minor Category: Long vs Short term
ALL OTHERS 3 Year Average Growth 3.1%
Anti-varicose
Ear Care
10
15
atestYearGro
Other OTC
Eye Care
Habit
Ear Care
0
5
La
ALL OTHERS Latest Year Growth
3.6%
Anti-haemorrhoids
Antifungals (Gyn)
Weight Loss
-5
0
-15 -10 -5 0 5 10 15 20
Weight Loss
15
-10
21
NB China 3Yr growth rate assumed to be the same as China 1 Yr growth rate
-15

Across APAC, just 4 of the Top10 corporations are MNCs
and only Takeda grows faster than the market
APAC
4.9%1. TAISHO 0.2%
Top 10 Corporations - APAC
Total APAC
4.4%
2.4%
2.3%
2. DAIICHI SANKYO
3. TAKEDA
1.2%
11.3%
2.0%
1.9%
1 8%
4. B.I.
5. GSK
6. J&J
-0.1%
-4.5%
-1 6%1.8%
1.7%
1.7%
6. J&J
7. ROHTO CORP
8. PFIZER
1.6%
-0.3%
1.8%
1.4%
1.4%
9. SATO SEIYAKU
10. KOWA
-1.3%
-4.8%
22

Among the western MNCs, RB has the highest growth
rate amongst the top players
APAC
2.0%4. B.I. -0.1%
Leading MNCs - APAC
Total APAC
4.4%
1.9%
1.8%
5. GSK
6. J&J
-4.5%
-1.6%
1.7%
1.3%
1.2%
8. PFIZER
11. SANOFI
13. BAYER
1.8%
-2.7%
3.9%
1.1%
0.8%
16. NOVARTIS
21. ABBOTT
17.0%
5.4%
0.7%
0.6%
23. RB
28. MERCK & CO
18.3%
7.2%
23
NB Ranking reflects position amongst all corporations

AGENDA
• Summaryy
24

APAC Highlights
APAC
Pain is a strong grower across APAC while Digestives and Cough &
Cold are “average”. But each category has higher opportunity
segmentssegments.
Pain shows greatest opportunity in China, India, Pacific and to some
extent ASEAN Systemic pain is the least dynamic sector whilstextent ASEAN. Systemic pain is the least dynamic sector whilst
Topicals, Muscular Children’s segments grow strongly
C h & C ld h Ch dCough & Cold is strongest as a growth opportunity in China, India
and ASEAN and in the cough/expectorant and sore throat segments.
Cold & flu remedies are slow growing and highly competitive.
Digestives look most promising in India, China and ASEAN although
anti-diarrhoeals are the slowest growing major segment.
Probiotics/digestives along with antacids grow fastest
25
/ g g g

Your Partner in Consumer Health
Thank you!
Anthony Morton-Small
Senior Principal Consumer Health
Veronita P. Rusli
Senior Principal, Consumer Health
Email : AMortonSmall@imscg.com
Phone : + 65-8328-3867
Veronita P. Rusli
Senior Manager, Consumer Health
Email : vrusli@sg.imshealth.com
Phone : + 65-9270-2568
Mungo Paterson
Engagement Manager
Email : mpaterson@sg.imshealth.com
Phone : + 65-9386-8113
26

2014 APAC Consumer Health SMR Summary by IMS Health

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Viewers also liked

Viewers also liked (18)

Similar to 2014 APAC Consumer Health SMR Summary by IMS Health

Similar to 2014 APAC Consumer Health SMR Summary by IMS Health (20)

More from QuintilesIMS Asia Pacific

More from QuintilesIMS Asia Pacific (20)

Recently uploaded

Recently uploaded (20)

2014 APAC Consumer Health SMR Summary by IMS Health