Pfizer and Mylan
In a statement on 22 August 2012 Pfizer and Mylan announced that they have signed a definitive agreement to establish an exclusive long-term strategic collaboration to develop, manufacture, distribute and market generic drugs in Japan.

Under the terms of the agreement, the two companies will each be responsible for different aspects of marketing the branded generics, which will be sold under the name of Pfizer but with joint labelling. Pfizer will use its strong brand reputation to market and sell the drugs. Mylan’s strengths lie with its strong global reputation for development of difficult to formulate products, quality manufacturing, supply chain reliability and service excellence. So the Indian generics giant will be in charge of managing operations, including research and development and manufacturing.

The collaboration between Pfizer and Mylan will include a portfolio of more than 350 marketed products across a broad range of therapeutic categories, as well as more than 125 additional products in development.

The strengths of the Japanese medicines market
Although the world’s second-largest pharma market, surpassed only by the US, Japan has traditionally been viewed as difficult to penetrate. Customer preference, supported by government pricing policies, has been for home-made pharmaceuticals.

Today, the government has changed its policy and is attempting to reduce the healthcare bill by growing the current volume of generics use from approximately 24% to 30% by the end of 2012 [1]. It has become the sixth largest generics retail prescription market worldwide, with sales figures rising by 6.9% to approximately Euros 4.1 billion in 2011. The Japanese generics market offers attractive growth prospects due to factors such as its ageing population, numerous impending drug patent expiries and a broad array of government initiatives aimed at reducing healthcare expenditure.

Meanwhile, the pharmaceuticals market was flat in the US in 2011 and actually declined in Europe as the result of price cuts and currency uncertainties. The Yen has increased in relative value since the 2008 crisis.

Enthusiasm for Japan
‘We are pleased with the opportunity to collaborate with Mylan to meet the ever-growing demand for high quality generics in Japan,’ Pfizer’s Established Products Chief, Mr Albert Bourla, said in a statement.

The collaboration is designed to build upon each company’s complementary strengths. ‘Over the past 59 years, Pfizer Japan has built trust with patients and customers, and developed a very strong Pfizer brand. We believe this agreement will help accelerate our ability to achieve our vision: Transform the Japanese Healthcare Environment with Established Products by 2020,’ Mr Bourla concluded.

Mylan has a growing portfolio of more than 1,100 generic pharmaceuticals. In addition, they offer a wide range of antiretroviral medicines, upon which approximately one-third of HIV/AIDS patients in developing countries depend. They are also one of the world’s largest active pharmaceutical ingredient manufacturers. So Japan fits well with their global perspective.

Pfizer is the largest foreign drug firm in the Japanese market and grew Japanese sales to Yen 576 billion (Euros 5.8 billion) last year, beating the average increase. GlaxoSmithKline’s sales in Japan leapt by 28% in 2011, and as much again in the first quarter 2012, making it the fastest-growing big drugmaker in the country.

In contrast, GlaxoSmithKline’s European sales fell by 4% in 2011, while US sales were flat. Pfizer’s European sales fell 5% and its US sales dropped 7%.

Reference

1.  GaBI Online - Generics and Biosimilars Initiative. Japanese government promoting generics [www.gabionline.net]. Mol, Belgium: Pro Pharma Communications International; [cited 2012 Sep 14]. Available from: www.gabionline.net/Generics/News/Japanese-government-promoting-generics