Top 3 Strategies Pharma Companies Must Employ to Mitigate Risks in Emerging Economies
The rapid economic growth in the emerging economies did give a lot of hope to the western pharma and health sciences companies for growth and expansion. But in the recent years, as the fizz around the emerging economies being the land of opportunities has waned out, major names in the pharma industry are having a […]
The rapid economic growth in the emerging economies did give a lot of hope to the western pharma and health sciences companies for growth and expansion. But in the recent years, as the fizz around the emerging economies being the land of opportunities has waned out, major names in the pharma industry are having a tough time finding a hold in these unsteady markets. Competition from regional players, fall in commodity prices, complying with the regional laws, and importantly, hiring the right talent, and building a productive workforce, have emerged as major bottlenecks for a majority of the pharma companies.
How do you bell the cat?
Industry experts at Infiniti Research believe that the emerging markets will witness a positive turn in the upcoming years. In fact, there are huge prospects for the pharma revenues to almost double in the next ten years. Therefore, even if the mature markets in the Americas and Europe seem to be a better option now, pharma majors should concentrate on building a full-fledged business strategy for the emerging economies.
The three major ways in which pharma companies can make a lasting impact in the emerging markets are:
1. Going beyond the commercial model
The basic commercial model is largely hinged on sales and marketing strategies. Perhaps this is where most pharma majors are going wrong. One major error, which many pharma companies commit is not going beyond this model. To make an impact in the emerging economies, one must adapt to the local conditions and come up with solutions which meet the local demands and constraints. Building a supply chain which is attuned to the local licensing nuances is sure to provide a competitive edge to the manufacturers. This is especially true in the case of pharma markets in Africa and the Middle- East.
2. Expansion of Patient Access
Most emerging economies are constantly struggling with undertreated and underdiagnosed diseases. This situation provides a great platform for the pharma companies to launch their drugs as well as expand their patient access. At the same time care needs to be taken that the drugs manufactured are easily available to lower-income patients in these regions. Pharma heads should work towards striking a fine balance between pricing strategy and market access. Usually opting for voluntary licensing deals play a critical role drawing incremental revenues, broadening patient access, and most of all building goodwill.
3. Not letting go of innovation
For some reason, pharma majors do not think of emerging economies as suitable hubs for innovative programs. However, there is a lot of scope and need for innovation in this geographical area as well. With a huge number of undertreated diseases, countries in Africa and Asia can, in fact, be converted into a test bed for innovative technologies and drug solutions. Right from digital health, to providing local solutions to health problems – the emerging markets provide a huge scope for experimentation to the pharma manufacturers. The winner in the long-run is going to be the company which leverages these advantages to disrupt the existing market.