Many Big Pharma companies -- like Pfizer, Eli Lilly, Merck and Novartis -- have identified boosting share and sales in Japan as a key strategy to mitigate the effects of lost revenue from drugs with expiring patent protection. And they are upping their sales and marketing activities to battle it out in the world's 2nd largest pharma market.
Signs of this increased emphasis include doubling the size of sales forces and increasing promotional spending as an industry by more than 26% since 2006 -- to reach $27.6 billion. Japan is attractive as a very developed market with a rapidly aging population -- 23% are > 65 years old -- or more than any developed country.
Japan's increased attractiveness is underscored by an increasing numbers of new product launches -- Merck with 7 in past 2 years and Novartis with 11 since 2009. The latter had sales of $3.3 billion in 2010 and wants to exceed $4 billion in a couple of years -- as well as move from No. 6 in market share to the top 3 in share. Similarly Lilly is trying to double its 2010 sales of $1.64 billion by 2015.
"China, you have to grow th market. With Japan, it's big already, you just have to get your share," says Ludwig Kanzler, partner at McKinsey & Co.
Posted by Bruce Lehr Sep 30th 2011.