CPhI Report Predicts 2018 to Be a Transformative Year for Japanese Pharma

A new report from CPhI has forecast that 2018 will be a transformative year for Japanese pharma as the market evolves towards growth in generics, biosimilars and increased internationalisation.

The ‘CPhI Japan 2018’ report – released ahead of the CPhI Japan scheduled to be held in April – has identified that demographic pressures on healthcare costs are driving a political agenda that will benefit players with lower costs solutions. Generics are an obvious route, but Japan’s status as a highly-developed economy with a pharma industry that leads in innovation opens other possibilities, particularly in the longer term for the biosimilars segment. In fact, an overwhelming 59% of domestic respondents believe biosimilars will be the fastest growing sector.

Crucially, as the Japanese pharma economy is in a state of transition towards greater openness, potential rewards for early international movers were cited as another key factor in the rapid shifts predicted in 2018.

The report also notes that while partnerships with domestic firms is the optimal strategy for new entrants to overcome obstacles like brand loyalty and lack of local knowledge, there is potential for direct entry and even acquisitions in the medium-term.

Challenges ahead

However, the report also highlights a number of drag factors. For example, in terms of how international companies approach the market – a local partner was viewed as a prerequisite of success – with brand loyalty also identified as a perennial issue.

Another consideration was that there remains information asymmetries bet-ween the views of international and domestic respondents, with markedly different perspectives on the effects of the impending patent cliff, how brand loyalty influences generics consumption, and to what extent regulatory efforts have been successful. One major difference is that domestic respondents believe that the PDMA (Pharmaceuticals and Medical Devices Agency) has made effective strides in tackling the drug approval backlog, while international respondents largely disagree.

“Overall, it is clear that Japan has performed well as a top-ranking pharma nation, excelling beyond mature markets such as France and the UK in projected growth and competitiveness. Heading into 2018, it appears that Japan’s recent efforts to internationalise has led to growth in the pharma industry that will continue over the course of this year,” the report said.

Ms. Laura Murina, Brand Manager, CPhI Japan at UBM, commented, “The Japanese pharma industry has recently made attempts to attract more global business and the report findings demonstrate that there are more opportunities than ever for new players to penetrate the market, particularly in generics and biosimilars.”

Source: Chemical Weekly