In 2011, China officially became the third biggest pharmaceutical market in the world – almost 50% bigger than fourth-placed Germany. Brazil, meanwhile, overtook mature European markets such as the UK, Italy and Spain, to climb to sixth place with 2011 sales of $27.7 billion. And it’s forecast to double in size by 2016. With IMS Health predicting sales in China reaching $143 billion in the same period, and Russia and India grossing $25.4 billion and $26.3 billion respectively, it’s easy to see why multi-national pharmaceutical companies are averting their attentions from traditional Western markets, and targeting so-called emerging nations for growth. A similar pattern is developing in the medical device industry – with major players acquiring or partnering with local companies, or indeed building a bricks-and-mortar presence in these ‘virgin’ territories.
The growing attraction of emerging markets has coincided with widespread efforts to improve access to healthcare for indigenous populations. The development of healthcare infrastructure and moves towards universal health coverage has become a common theme in developing nations – not least the BRIC (Brazil, Russia, India and China) regions. And it’s stimulating growth opportunities for the life science sectors.
BRICs in Place
In 2009, China introduced a healthcare reform program to deliver universal coverage and basic, low-cost health services to all of its 1.3 billion citizens. It has subsequently progressed impressively. Reform in Russia began in 2005 with the introduction of a state reimbursement program. More recently, two new reform programs have been introduced; Development of Health 2020 and Pharmaceutical 2020.
In India, healthcare spending by federal and state governments has increased significantly. Although infrastructure and the number of healthcare professional are still considered sub-optimal, resources in both the hospital and primary care sectors are growing steadily. Meanwhile, in Brazil, where the constitution guarantees the state provision of high-quality healthcare as a universal right – the government has bold plans to take 16 million people out of poverty, and ensure they have adequate healthcare cover, by 2020. Provision currently remains variable, but healthcare spending is tipped to grow by 62% between 2010 and 2020.
MIST on the horizon
While the BRIC cluster is acknowledged as the most mature of all emerging regions, progress is also being made in other developing nations. In a corporate environment that loves an acronym, it’s hardly surprising that catchy new clusters are steadily being established. In recognition of the growing economies in Mexico, Indonesia, South Korea and Turkey, analysts have coined ‘MIST’ as the next breed of emerging nations. With Indonesia (16th) and South Korea (15th) among the biggest economies in the world – and tipped to grow further – life sciences expansion into these regions appears a natural progression. Likewise, with South Africa being formally added to the BRIC cluster in 2011 – and described as a leading emerging economy – the newly-named BRICS underlines the vast potential of the African region.
Implications for Life Science Companies
Life Science companies’ attraction to emerging markets is understandable – but expansion into these disparate regions presents numerous challenges. Whether partnering with local companies, establishing their own operations or conducting clinical trials in emerging markets, the need to understand local nuances and regulatory conditions is paramount. This is particularly the case in the production environment, where product recalls due to labeling defects or non-compliance can have far-reaching repercussions; the potential impact on productivity, speed to market and long-term profitability is significant. In order to deliver safe, accurate and compliant product information to patients and end-users in emerging markets, companies should increase their focus on the effective management and sharing of data across the production lifecycle. And technology can play a huge part.
Fully integrated label lifecycle management solutions can not only assure regulatory compliance, but in an environment where companies are increasingly looking to contain costs, they can also provide a robust platform from which companies can drive operational efficiency and productivity gains, expedite product to market and increase productivity.
Maintaining regulatory compliance is perhaps the biggest hurdle for life science companies looking to expand into emerging markets. With healthcare already acknowledged as one of the most regulated sectors, the need for compliance is nothing new – but companies’ ability to adhere to local regulations is challenged by the variability of guidelines and protocols from region to region.
Fittingly, the emerging markets are characterized by emerging regulations; individual nations are steadily putting legislation in place to protect patient safety – but approaches are wide-ranging and, in many cases, differ dramatically from traditional Western practices. In China, efforts to mirror the US FDA are well underway, with the establishment of the China Food and Drug Administration (CFDA). The new authority, which was introduced in March 2013, will play an important role in regulating drugs and devices – and came in the wake of patient safety breaches and scandals relating to substandard medicines in China.
Regulation surrounding the coding, marking and labeling of medical products is a hot topic. In traditional Western markets, GS1 was accredited as the global standard for Unique Device Identifiers (UDIs) in December 2013. GS1 creates a global system of standards across the healthcare supply chain, and its adoption is seen as fundamental to the efficient and effective implementation of UDI by healthcare stakeholders worldwide. The UDI rule is being rolled out in the US, with other nations expected to adopt similar regulations in the coming months.
But while GS1 brings some commonality to UDI requirements in mature markets, and has a presence in over 100 countries, a uniform system has yet to be adopted across emerging nations. Life science companies must therefore be well versed in country-specific regulations to ensure their operations meet local requirements. To achieve this, they should seek to identify partners and solutions that are flexible enough to adapt to regulatory requirements for any mandate, in any country. The most effective solutions will ensure companies adhere to local standards, and can control data, design, print and inspect transparently and optimally.
Lost in Translation
A further challenge for companies is the efficient management of local language labeling – in particular with IFUs (Instructions for Use), PILs (Patient Information Leaflet), booklets and labels. Labels must be safely and accurately customized so that they are in the appropriate local languages and nuances, and can convey information coherently to end-users and others within the supply chain. Yet companies have traditionally struggled to find a reliable way of approving and locking down local language data.
The sector’s historically inconsistent approach to local language labeling has carried inherent risks. Primarily, the potential for labeling errors can have major human, reputational and financial repercussions. In addition, companies’ reliance on disjointed, disparate systems and manual processes can lead to significant inefficiencies in the supply chain, the deceleration of product to market and an escalation in development costs.
While this has long been a global problem, in the emerging markets – where companies have little experience on the ground – the challenge of local language labeling is magnified. As regulatory scrutiny intensifies, the need for clear language control for IFUs, PILs and supporting literature is critical. So how can companies progress?
The solutions are out there. Fully integrated label lifecycle management systems can capture and manage data right across an end-to-end process, bringing information together at the right time – and in the right format – to deliver cost-effective ‘just in time’ or ‘on demand’ printing. This approach reduces the need, and associated costs, of printing multi-language booklets in bulk. And it mitigates the risk of costly labeling errors.
The most effective solutions will be web-enabled and scalable, and driven by data not label outputs. Moreover, they will optimize technology to deliver a single, version controlled and auditable process to manage the entire label lifecycle – irrespective of country, language or regulatory requirements.
The Way Forward
As life science companies develop their strategies to exploit the growth potential of emerging markets, senior management would be well advised to consider their labeling infrastructure right at the very outset of their planning. The key is to be proactive. Early identification of the right partners can help companies design and deliver operations that meet country-specific requirements. The best partners will be those that demonstrate a comprehensive understanding of the local regulatory environment, as well as experience of implementing solutions on the global stage.
Moreover, to thrive in emerging markets in the highly regulated healthcare sector, the most effective partners will be those whose services are underpinned by technologies that provide robust governance, quality assurance and data control. By deploying a validated solution, companies can be confident that the integrity and accuracy of their data is assured. End-to-end systems should provide version control and accessibility to all appropriate stakeholders from regulatory to marketing – and audit trail functionality to allow the retrospective review of processes throughout the label lifecycle.
The emerging markets present major growth opportunities for multi-national life science companies – but to exploit them, organizations must ensure they put the right infrastructure in place to mitigate risk and protect patient safety. With a 360° view of all the variable data components across the production and packaging process, pharmaceutical and medical device companies could have China in their hands. But without it, the opportunity could shatter altogether.
For more information, visit PrisymID.