 "Indian drug makers eye Japan for growth and to diversify risk")
Indian drugmakers are exploring growth opportunities in Japan, the world’s second largest pharmaceutical market, in the light of the government’s push for greater consumption of generic drugs.
The US accounts for 40-50 per cent of revenue for top Indian pharma companies, whose exposure to Japan has been limited. The exception is Lupin (been present in Japan since 2007), which has now bought 21 branded products from Shionogi to expand its Japan business.
The US accounts for 40-50 per cent of revenue for top Indian pharma companies, whose exposure to Japan has been limited. The exception is Lupin (been present in Japan since 2007), which has now bought 21 branded products from Shionogi to expand its Japan business.
This is the second big acquisition by an Indian pharma company in Japan in recent months. In March, Sun Pharmaceutical Industries acquired branded drugs from Novartis in a deal worth Rs 1,900 crore.
ALSO READ: Sun Pharma to tap Japan's growing focus on generics
“Entry into the Japanese market is difficult but the rewards are greater. The Japanese government is keen to promote generic medicines and has been in dialogue with the commerce ministry of India. We have been working with our government in this regard. Japan’s drug regulator also plans to set up office in India and that will quicken the process of approvals of manufacturing sites in India,” said D G Shah, secretary-general of the Indian Pharmaceutical Alliance.
Indian firms are under pressure because of concerns raised by the US Food and Drug Administration, and increasing the exposure to Japan would help them diversify risk, he added.
Japan, traditionally a market for innovators and branded products, is seeing a shift towards generics as its government tries to cut social welfare spending. Generic drugs account for about half of total sales in Japan and the government aims to increase this to 80 per cent. The push towards generics is coupled with price cuts in off-patent drugs.
“Indian companies are making efforts to strengthen their presence in Japan. They have strong capabilities in producing quality medicines and we are working to clarify all their concerns,” said P V Appaji, director-general of the Pharmaceutical Exports Promotion Council of India.
Ahmedabad-based Cadila Pharmaceuticals exports Active Pharmaceutical Ingredients to Japan, though it is not a significant portion of exports. The company has a procurement office, too, at Japan. However, there are no immediate plans of scaling up there at the moment, a company executive said.
Last month Biocon’s Japanese partner, Fujifilm Pharma, launched its biosimilar Insulin Glargine in Japan, after approval from the Japanese health authority earlier this year.
“Entry into the Japanese market is difficult but the rewards are greater. The Japanese government is keen to promote generic medicines and has been in dialogue with the commerce ministry of India. We have been working with our government in this regard. Japan’s drug regulator also plans to set up office in India and that will quicken the process of approvals of manufacturing sites in India,” said D G Shah, secretary-general of the Indian Pharmaceutical Alliance.
Indian firms are under pressure because of concerns raised by the US Food and Drug Administration, and increasing the exposure to Japan would help them diversify risk, he added.
Japan, traditionally a market for innovators and branded products, is seeing a shift towards generics as its government tries to cut social welfare spending. Generic drugs account for about half of total sales in Japan and the government aims to increase this to 80 per cent. The push towards generics is coupled with price cuts in off-patent drugs.
“Indian companies are making efforts to strengthen their presence in Japan. They have strong capabilities in producing quality medicines and we are working to clarify all their concerns,” said P V Appaji, director-general of the Pharmaceutical Exports Promotion Council of India.
Ahmedabad-based Cadila Pharmaceuticals exports Active Pharmaceutical Ingredients to Japan, though it is not a significant portion of exports. The company has a procurement office, too, at Japan. However, there are no immediate plans of scaling up there at the moment, a company executive said.
Last month Biocon’s Japanese partner, Fujifilm Pharma, launched its biosimilar Insulin Glargine in Japan, after approval from the Japanese health authority earlier this year.
ALSO READ: Biocon launches insulin Glargine in disposable pens in Japan
Biocon sees a big opportunity in Japan. “The Insulin Glargine launch in a highly regulated market like Japan marks a huge credibility milestone. This will enable Biocon to address the growing needs of diabetes patients in Japan, which reported 7.2 million cases in 2015. Follow-on biologics are beginning to get accepted in Japan, which augurs well for players like Biocon. We hope to enable the Japanese government to bring down its health care expenditure on expensive biologics for chronic conditions like diabetes, cancer and autoimmune by providing access to high-quality affordable biosimilars developed by Biocon,” Kiran Mazumdar-Shaw, chairman and managing director of Biocon, said last month.
MERGERS & ACQUISITIONS
Big-ticket buyouts of brands and companies by Indian firms
2015
Biocon sees a big opportunity in Japan. “The Insulin Glargine launch in a highly regulated market like Japan marks a huge credibility milestone. This will enable Biocon to address the growing needs of diabetes patients in Japan, which reported 7.2 million cases in 2015. Follow-on biologics are beginning to get accepted in Japan, which augurs well for players like Biocon. We hope to enable the Japanese government to bring down its health care expenditure on expensive biologics for chronic conditions like diabetes, cancer and autoimmune by providing access to high-quality affordable biosimilars developed by Biocon,” Kiran Mazumdar-Shaw, chairman and managing director of Biocon, said last month.
MERGERS & ACQUISITIONS
Big-ticket buyouts of brands and companies by Indian firms
2015
- Lupin acquires US drug maker Gavis in a $880-million deal. The transaction closed in 2016
- Cipla acquires US drug makers Invagen and Exelan in $550-million deal. The transaction closed in 2016
- Lupin acquires branded drug portfolio from Shionogi for about Rs 1,000 crore
- Dr Reddy’s Laboratories acquires eight drugs from Teva for Rs 2,300 crore
- Sun Pharmaceutical Industries acquires branded drug portfolio of Novartis in Japan for Rs 1,900 crore