Big Pharma's march into emerging markets could run into some roadblocks. Indeed, some drugmakers have already run up against obstacles, while others may soon find their emerging-markets strategies need some tweaking, Reuters reports.
GlaxoSmithKline ($GSK) faces pricing pressure in Turkey and Russia. Novo Nordisk ($NVO) saw Chinese sales drop by 3% because of cost-cutting. AstraZeneca ($AZN) found itself facing early generic competition in Brazil for its branded drugs Crestor and Seroquel, which cut into emerging-markets growth by three percentage points.
Meanwhile, the whole branded-generics approach may offer only a short term promise. KPMG'S Chris Stirling told Reuters that Chinese drug-pricing moves have cut into Big Pharma's ability to price meds at a premium. And as Deutsche Bank's Tim Race told the news service, the imprimatur of Big Pharma is only highly prized where lesser drug companies can't be trusted. "[T]he Chinese and Brazilians and others are quite quickly coming online with better regulation, creating better trust in local products," Race added.
- see the analysis from Reuters