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According to Ernst & Young, the sheer volume and growing economic muscle of consumers in emerging markets provide powerful investment incentives for multinational companies (MNCs). In particular, current and projected growth rates for pharmaceutical markets in the BRIC countries and Mexico exceed those in the more mature markets in the United States, Europe, and Japan. While the latter markets represent a significantly higher pro portion of global pharmaceutical sales, indus try executives are honing their strategies to dominate the highergrowth emerging mar kets. IMS has identified what it calls “pharmerg ing” countries, being China, Brazil, Mexico, South Korea, Turkey, India, and Russia. Among the leading 15 markets from 2008 forward, these countries are predicted to have a higher compound annual growth rate between 2006 and 2011, a transitional disease profile, growing access to medicines, and expanding public health programs. According to IMS, pharmerging markets, which are expected to have market growth of 12% to 13% in 2008, are striving to broaden access to healthcare schemes; developing pri mary care in rural areas; providing greater access to medicines, both innovative and generic; and growing private health insurance. All in all, pharmerging markets are expected to account for 24% of the total market growth, while the top seven markets — the United States, Japan, and the top five Euro pean markets — are expected to contribute just less than 50% of the growth. Beyond BRIC: NewAreas of Growth Many multinational companies (MNCs) have already turned their focus to the BRIC countries of Brazil, Russia, India, and China, and they may consider those countries as emerged as opposed to emerging.As these countries move to the fore front, there is a growing interest in the opportu nities that Korea, Mexico, and Turkey might bring. Forward thinking companies are starting to investigate the Next Eleven, or N11 countries, which include Vietnam, Indonesia, and the Philippines. BY ROBIN ROBINSON Global OPPORTUNITIES THE PHARMACEUTICAL INDUSTRY IS BEGINNINGTO EXPLORE AREAS OUTSIDETHE BRIC COUNTRIES OFBRAZIL, RUSSIA, INDIA,AND CHINA FOR INVESTMENT OPPORTUNITIES.Looking beyond these borders at new emerging market opportunities comes down to assessing regulatory risk, product access, infrastructure, political climate, and patient populations.This month’s forum discusses the opportunities, challenges, and trends of the emerging markets. Pharma is interested in two types of opportunities: increasing global sales and reducing costs both from a manufacturing and R&D standpoint. ERIC RAMBEAUX Solvay A 8 M a r c h 200 8 PharmaVOICE PV0308 LAYOUT 2/14/08 5:39 PM Page 8 GLOBAL opportunities RAMBEAUX. SOLVAY. It is now generally accepted that BRIC countries could be the El Dorado for the pharma industry. We could probably add countries like Indonesia or Mex ico. Pharma is interested in two types of opportunities: increasing global sales and reducing costs both from a manufacturing and R&D standpoint. From a sales opportunity standpoint, we should not forget that even if the population of these countries is enormous, their healthcare structure is very limited. Pharmaceutical products are geographically and financially available only to a limited number of people. Prevention — vaccinal or pharmacological — practically does not exist. Although the populations are huge, I do not foresee innovative drugs quickly and sustain ably penetrating these markets. The opportu nities lie in the drugs with strong brand equi ty and that are inexpensive compared with more recent drugs. Considering noncommer cial opportunities, I think the situation differs greatly by country. India offers many opportu nities in terms of manufacturing outsourcing. Indian companies have developed an expertise in chemical engineering, costefficient manu facturing, and pharmaceutical development. Many Indian plants are EMEA and/or FDA approved. From an R&D standpoint, pharma views India as the ideal ground for clinical development — quick, cheap, and in princi ple, having reliable clinical trials. Many CROs have emerged to grab part of this market. India also offers opportunities in terms of stateoftheart pharmaceutical development. In terms of compound sourcing, Indian com panies are investing a lot of resources in R&D, LEWIS CAMERON. Executive VP, Europe, Chiltern International, London;Chiltern is a global contract research organization with experience running and staffing Phase I to Phase IV clinical trials. For more information, visit chiltern.com. DIANA CONMY. Corporate Director, Market Insights, IMS Health, Norwalk,Conn.; IMS Health is a provider of market intelligence to the pharmaceutical and healthcare industries. For more information, visit imshealth.com. PARTHA GHOSH.Chairman and Chief Mentoring Officer, Boston Analytics, Boston; Boston Analytics provides current, accurate, and actionable research and analytics. For more information, visit bostonanalytics.com. CHRIS GRAY.Market Leader, Global Pharmaceutical Center, Ernst &Young,New York; Ernst &Young helps organizations form the right alliances, access funding,and gain insight into the market and regulatory environment of today’s dynamic healthsciences market.For more information, visit ey.com. R.T. (TERRY) HISEY.Vice Chairman and U.S. Life Sciences Leader, Deloitte & Touche USA LLP, Philadelphia; Deloitte & Touche USA’s lifesciences practice helps pharmaceutical and biotechnology companies respond to market forces and increase their possibilities by addressing challenges in today’s complex environment.For more information, visit deloitte.com. STEPHEN POTTS.Regional Director, Healthcare — Asia Pacific, the Middle East, and Africa,TNS Healthcare, Singapore;TNS Healthcare with headquarters in NewYork, is part of TNS and provides globally consistent solutions and custom advisory services to support product introductions, brand, treatment,and salesperformance optimization, as well as professional and DTC promotional tracking. For more information, visit tnsglobal.com/healthcare. ERIC RAMBEAUX.VP,Business Strategy and Portfolio, Solvay Pharmaceuticals,Belgium; Solvay Pharmaceuticals,a researchdriven group of companies that constitute the global pharmaceutical business of the Solvay Group, seeks to fulfill carefully selected, unmet medical needs in the therapeutic areas of neuroscience,cardiometabolic, influenza vaccines, gastroenterology, and men’s and women’s health. For more information, visit solvaypharmaceuticals.com. THOUGHT LEADERS In general,pharma is managing a greater number of risks entering emerging markets compared with other sectors. CHRIS GRAY Ernst &Young 9 PharmaVOICE M a r c h 2008 PV0308 LAYOUT 2/14/08 5:39 PM Page 9