largest pharmaceutical market by 2020, after the US and China.
Despite its strong economic growth, Brazil is facing increasing
pressure to control healthcare expenditure and, at the same
time, to promote innovation and improve access to healthcare.
In pursuit of this difficult task, decision-makers are discussing several initiatives, some of them already converted
into law, which will reshape the pharmaceutical market in the
next few years. In the context of increasing competition and
stricter regulatory hurdles, Brazil will become a much more
challenging business environment.
DECREASING TAXATIONS ON PHARMACEUTICALS
Even though international companies operating in the
Brazilian healthcare market represent approximately 20 percent of the total healthcare manufacturers based in Brazil,
they represent 75 percent of market share.
Decreasing taxation on medicines for human use is seen
as an effective way to promote and incentivize the 550+ laboratories in the internal pharmaceutical sector. Two different
measures adopted in the last year confirm this strategy:
1) On November 28, 2012, the Brazilian Committee on
Constitution, Justice and Citizenship approved a replacement bill proposing a constitutional amendment that would
prohibit the collection of taxes on medicines for human
use. The import tax, however, will remain in place as it
“serves as an instrument of government economic policy,
which should continue providing the flexibility to manoeu-
■ By Davide Zaganelli, Global Emerging Markets Manager, Alliance Life Sciences
Emerging markets are considered the new frontier for pharma- ceutical companies, and represent hope for an industry seek- ing new strategies and partnerships to balance the stagnation in more mature markets. With expectations of reaching 30 percent of the nearly $1.2 trillion US global spend -- and 50-70 percent of the $70 billion annual US growth forecasted in the
pharmaceutical sector by 2016 -- it is clear why emerging markets present an enticing opportunity for pharma.
But emerging markets defy the effectiveness of a uniform
approach and call for local business planning based on a comprehensive and global perspective. For this reason, international pharmaceutical companies must be willing to implement
market-specific strategies and local thinking within their global
business strategy. Furthermore, evolving political stances, increasing international competition, and rising local manufacturers are toughening market access environments and creating
new, and sometimes unexpected, risks for drug makers.
Brazil provides one of several examples in which business
conditions for drug makers are quickly changing, emphasizing
the importance of identifying, evaluating, and foreseeing such
changes as early as possible in order to improve and consolidate market positioning.
LATEST REFORMS AND NEW CHALLENGES
With over $220 billion of healthcare expenditure, strong eco-
nomic growth, and drug prices adjusted annually ( 2. 7-6. 31 percent
increase estimated in 2013), Brazil is destined to become the third
Pharmaceutical Access in Emerging Markets
How the latest developments in Brazil will change your business strategy
Number of generic drugs registered in Brazil