Emerging Pharmaceutical Market in Brazil Regulatory Framework Forces MNCs to Partner with Local Players Resulting in Profit and Control Sharing

Summary

GBI Research’s new report, “Emerging Pharmaceutical Market in Brazil Regulatory Framework Forces MNCs to Partner with Local Players Resulting in Profit and Control Sharing” provides an in-depth analysis of the trends, issues and challenges in the pharmaceutical market in Brazil. The report analyzes the overall pharmaceutical and outsourcing market structure of the country. The report provides competitive benchmarking for the leading companies and analyzes the M&A and strategic partnerships that shape the Brazilian pharmaceutical market. The report is built using data and information sourced from proprietary databases, primary and secondary research and in-house analysis by GBI Research’s team of industry experts.

The Brazilian pharmaceutical market is one of the top emerging markets globally. In terms of revenue it is the seventh largest market in the world and the largest in Latin America. Since the introduction of the new Patent Law in 1997, many foreign pharmaceutical companies have entered the Brazilian market. However, due to the lack of government support in the country, these companies (MNCs) have mostly partnered with local players for the expansion of their services. 

GBI Research analysis shows that generics have achieved higher growth in the market due to legal and regulatory support. The generics accounted for 20.6% of the market share in 2011 and are expected to grow in future. Both private and public sectors are playing a role in the healthcare infrastructure of the country. The availability of reasonably priced raw materials and good access to the patient pool, well-equipped facilities, high-quality staff and infrastructure are the major attractions for foreign players.

The Brazilian pharmaceutical market grew at a CAGR (Compound Annual Growth Rate) of 9% between 2004 and 2010. The economic growth of the country was above the world average and inflation was low compared to Argentina and Paraguay. In accordance with the Brazilian Ministry of Health, the private healthcare sector contributes approximately 2% of Brazil’s GDP.

According to GBI Research’s analysis, the Brazilian pharmaceutical market poses a number of challenges due to its diverse nature, which creates difficulties in terms of understanding the characteristics of sub-regions. The major challenge for foreign players planning to enter the market is the legal framework of the country. This forces the companies into partnering with local companies, resulting in profit and control sharing. The legal and regulatory framework for patents is limited, leading to a lack of protection for intellectual property rights. This tends to result in difficulties for companies spending on R&D.

Scope

• The overall pharmaceutical, biotech and outsourcing market structure in Brazil
• A market characterization of the Brazilian pharmaceutical market, including market size, major regulatory bodies, pricing and reimbursement issues, major distribution channels and intellectual property rights.
• Brazilian CRO market growth
• Analysis of the leading segments within the Brazilian pharmaceutical industry
• Market drivers and restraints that have a significant impact on the market.
• Competitive benchmarking of the leading companies in the pharmaceutical and CRO markets.
• Key M&A activities and strategic partnership deals that have taken place between 2004 and mid-2011.

Reasons to buy

• Develop market-entry and market expansion strategies by identifying the leading emerging markets poised for strong growth.
• Develop a tailored country strategy through the understanding of key drivers and barriers of each country’s pharmaceutical market.
• Develop key strategic initiatives by understanding the key focus areas of leading companies.
• Accelerate and strengthen your market position by identifying key companies for mergers, acquisitions and strategic partnerships.

1 Table of Contents 5

1.1 List of Tables 7

1.2 List of Figures 8

3.1 Market Size and Market Forecast 11

3.2 Market Share by Therapy Area 12

3.3 Branded versus Generic Market Share 13

3.4 R&D Expenditure Innovations 14

3.4.1 Increased Screening Rates during R&D 14

3.5 Top Pharmaceutical Companies in Brazil 15

3.5.1 Domestic Players 15

3.5.2 Foreign Players 20

3.6 Drivers and Challenges 24

3.6.1 Drivers 24

3.6.2 Barriers 25

3.7 Healthcare Delivery System 26

3.7.1 Brazil Healthcare Delivery Opportunities 26

3.7.2 Brazil Healthcare Delivery Challenges 27

3.8 PESTLE Analysis 29

3.8.1 Political factors 29

3.8.2 Economic factors 29

3.8.3 Social factors 29

3.8.4 Technological factors 30

3.8.5 Legal factors 30

3.8.6 Environmental factors 30

4.1 Demographic Analysis 31

4.1.1 Population Size, Growth, and Structure 31

4.1.2 Disease Overview in Brazil 34

4.2 GDP 39

4.3 Per Capita Income 41

4.3.1 Context 41

4.3.2 Analytical Framework 41

4.4 Healthcare Expenditure 42

4.4.1 Context 42

4.4.2 Analytical Framework 43

4.5 Healthcare Infrastructure 44

4.5.1 Analytical Framework 45

5.1 Pharmaceutical Regulation in Brazil 47

5.2 Drug Approval Process 47

5.3 Drug Registration Process 48

5.4 Patents and Generics (IPR) 49

5.5 Health Insurance Coverage 50

5.6 Clinical Trials 50

5.6.1 Context 50

5.6.2 Analytical Framework 51

5.7 Pricing and Reimbursement 51

5.7.1 Private Insurance 52

5.7.2 Hospotels 55

5.7.3 Cosmetic Travel 55

5.8 Regulatory Bodies 56

5.8.1 Ministry of Health (MOH) 56

5.8.2 Unified Health System (UHS also called as SUS in Brazil) 57

6.1 Mergers and Acquisitions 58

6.1.1 M&A Deals by Year 58

6.1.2 Deal by Value 59

6.1.3 Recent M&A Deals 60

6.1.4 Top Five M&As 60

6.2 Co-development Deals 61

6.2.1 Deals by Year 61

6.2.2 Deal by Value 62

6.2.3 Recent Co-development Deals 62

6.2.4 Top Co-development Deals 63

6.3 Licensing Agreements 64

6.3.1 Deals by Year 64

6.3.2 Deals by Value 65

6.3.3 Recent Licensing Agreements 65

6.3.4 Top Licensing Agreements 66

7.1 Contract Research Organization (CRO) Market Size and Growth 67

7.1.1 PPD 67

7.1.2 PRA International 68

7.1.3 ICON 69

7.1.4 Theorem Clinical Research 70

7.1.5 PAREXEL 71

7.1.6 Intrials 72

7.1.7 Eurotrials 73

7.1.8 PGS Medical/Statistics 74

7.1.9 INC Research 75

7.1.10 Chiltern 76

7.1.11 Covance 77

7.1.12 Quintiles 78

8.1 Market Definitions 79

8.2 Abbreviations 79

8.3 Sources 80

8.4 Research Methodology 80

8.4.1 Industry Performance 81

8.4.2 Macroeconomic Environment 81

8.4.3 Healthcare Regulations 81

8.4.4 Industry Trends 81

8.5 Contact Us 81

8.6 Disclaimer 81

Table 1: Emerging Pharmaceutical Market: Brazil, Revenue, $bn, 2004–2011 11

Table 2: Emerging Pharmaceutical Market: Brazil, Revenue Forecasts, $bn, 2011–2018 11

Table 3: Emerging Pharmaceutical Market: Brazil, Population Age Structure, (%) ,1950–2050 31

Table 4: Emerging Pharmaceutical Market in Brazil, Population Forecast of Brazil, (Million), 2005–2050 33

Table 5: Emerging Pharmaceutical Market: Brazil, Number of Deaths by Major Diseases, (%), 2008 34

Table 6: Emerging Pharmaceutical Market: Brazil, Population Forecast for HIV/AIDS Prevalence (‘000), 2011-2018 35

Table 7: Emerging Pharmaceutical Market: Brazil, Population Forecast for CVD Prevalence (Million), 2011–2018 36

Table 8: Emerging Pharmaceutical Market: Brazil, Population Forecast for Diabetes Prevalence (Million), 2011-2018 37

Table 9: Emerging Pharmaceutical Market: Brazil, Population Forecast for Cancer Prevalence (‘000), 2011–2018 38

Table 10: Emerging Pharmaceutical Market: Brazil, GDP Results at Market Prices from 1Q-2010 to 1Q- 2011 39

Table 11: Emerging Pharmaceutical Market: Brazil, Per Capita Income, ($), 2000–2011 41

Table 12: Emerging Pharmaceutical Market: Brazil, Comparative Analysis of Healthcare Expenditure Ratios, Argentina, Mexico and BRIC Countries (%), 2010 41

Table 13: Emerging Pharmaceutical Market: Brazil, Public and Private Distribution, (%), 2008 44

Table 14: Emerging Pharmaceutical Market: Brazil, Healthcare Infrastructure, 2008 45

Table 15: Emerging Pharmaceutical Market – Brazil, Documents Required for Product Registration by ANVISA 49

Table 16: Emerging Pharmaceutical Market – Brazil, Clinical Trials Market, ($m), 2011–2018 50

Table 17: Emerging Pharmaceutical Market – Brazil, Number of Plan Members and Revenue, ($bn), 2011 54

Table 18: Emerging Pharmaceutical Market – Brazil, Private Healthcare Coverage Providers, Number of Plan Members and Revenue, (R $m), 2011 55

Table 19: Emerging Pharmaceutical Market – Brazil, Surgeries, Cost Comparison, the US and Brazil ($), 2009 55

Table 20: Emerging Pharmaceutical Market – Brazil, Recent M&A Deals, 2009–2011 60

Table 21: Emerging Pharmaceutical Market – Brazil, Recent Co-development Deals, 2011 62

Table 22: Emerging Pharmaceutical Market – Brazil, Recent Licensing Agreements, 2011 65

Figure 3: Emerging Pharmaceutical Market: Brazil, Revenue Forecast, $bn, 2004–2018 11

Figure 4: Emerging Pharmaceutical Market: Brazil, Market Share by Therapy Area, (%), 2010 12

Figure 5:  Emerging Pharmaceutical Market: Brazil, R&D Restructuring Activities, 2011 14

Figure 6: Emerging Pharmaceutical Market – Brazil, Key Domestic Players, EMS Sigma Pharma , SWOT Profile, 2011 15

Figure 7: Emerging Pharmaceutical Market – Brazil, Key Domestic Players, Ache Laboratorios Farmaceuticos, SWOT Profile, 2011 16

Figure 8: Emerging Pharmaceutical Market – Brazil, Key Domestic Players, Eurofarma, SWOT Profile, 2011 17

Figure 9: Emerging Pharmaceutical Market – Brazil, Key Domestic Players, Medley Pharmaceuticals, SWOT Profile, 2011 18

Figure 10: Emerging Pharmaceutical Market – Brazil, Key Domestic Players, Hypermarcas, SWOT Profile, 2011 19

Figure 11: Emerging Pharmaceutical Market – Brazil, Key Foreign Players, Sanofi, SWOT Profile, 2011 20

Figure 12: Emerging Pharmaceutical Market – Brazil, Key Foreign Players, Novartis, SWOT Profile, 2011 21

Figure 13: Emerging Pharmaceutical Market – Brazil, Key Foreign Players, Pfizer, SWOT Profile, 2011 22

Figure 14: Emerging Pharmaceutical Market – Brazil, Key Foreign Players, Roche, SWOT Profile, 2011 23

Figure 15: Emerging Pharmaceutical Market: Brazil, Drivers and Barriers in the Brazilian Pharmaceutical Market 24

Figure 16: Emerging Pharmaceutical Market: Brazil, Healthcare Delivery Opportunities, 2011 26

Figure 17: Emerging Pharmaceutical Market: Brazil, Healthcare Delivery Barriers, 2011 27

Figure 18: Emerging Pharmaceutical Market: Brazil, PESTLE Analysis 29

Figure 19: Emerging Pharmaceutical Market: Brazil, Population Age Structure, (%), 1950–2050 31

Figure 20: Emerging Pharmaceutical Market: Brazil, Health Indicators, 2011 32

Figure 21: Emerging Pharmaceutical Market in Brazil, Population Forecast of Brazil, (Million), 2005–2050 33

Figure 22: Emerging Pharmaceutical Market: Brazil, Number of Deaths by Major Diseases, (%), 2008 34

Figure 23: Emerging Pharmaceutical Market: Brazil, Population Forecast for HIV/AIDS Prevalence (‘000), 2011-2018 35

Figure 24: Emerging Pharmaceutical Market: Brazil, Population Forecast for CVD Prevalence (Million), 2011–2018 36

Figure 25: Emerging Pharmaceutical Market: Brazil, Population Forecast for Diabetes Prevalence (Million), 2011-2018 37

Figure 26: Emerging Pharmaceutical Market: Brazil, Population Forecast for Cancer Prevalence (‘000), 2011–2018 38

Figure 27: Emerging Pharmaceutical Market: Brazil, GDP Composition by Sector (%), 2011 39

Figure 28: Emerging Pharmaceutical Market: Brazil, GDP and Inflation Rates, 2005–2011 40

Figure 29: Emerging Pharmaceutical Market: Brazil, National Healthcare Expenditure, (% of GDP), 2010 42

Figure 30: Emerging Pharmaceutical Market: Brazil, Comparative Analysis of Healthcare Expenditure Ratios, Argentina, Mexico and BRIC Countries, (%), 2010 43

Figure 31: Emerging Pharmaceutical Market: Brazil, Public and Private Distribution, (%), 2008 44

Figure 32: Emerging Pharmaceutical Market: Brazil, Healthcare Infrastructure, 2008 45

Figure 33: Emerging Pharmaceutical Market: Brazil, Healthcare Professionals, (%), 2008 46

Figure 34: Emerging Pharmaceutical Market: Brazil, Hospitals, by Bed Distribution, (%), 2008 46

Figure 35: Emerging Pharmaceutical Market: Brazil, Regulatory Approval Process for Clinical Trials 47

Figure 36: Emerging Pharmaceutical Market: Brazil, Drug Registration Process by ANVISA 48

Figure 37: Emerging Pharmaceutical Market – Brazil, Clinical Trial Market, ($m), 2011–2018 50

Figure 38: Emerging Pharmaceutical Market – Brazil, Reimbursement, 2011 51

Figure 39: Emerging Pharmaceutical Market – Brazil, Healthcare Coverage Providers, Plan Members, (%), 2010 53

Figure 40: Emerging Pharmaceutical Market – Brazil, Healthcare Coverage Providers, Revenue, (%), 2011 54

Figure 41: Emerging Pharmaceutical Market – Brazil, M&A Deals by Year, 2004–2011 58

Figure 42: Emerging Pharmaceutical Market – Brazil, M&A Deals by Value, (%), 2004–2011 59

Figure 43: Emerging Pharmaceutical Market – Brazil, Co-development Deals by Year, 2004–2011 61

Figure 44: Emerging Pharmaceutical Market – Brazil, Co-development Deals by Value, (%), 2004–2011 62

Figure 45: Emerging Pharmaceutical Market – Brazil, Licensing Agreements by Year, 2004–2011 64

Figure 46: Emerging Pharmaceutical Market – Brazil, Licensing Agreements by Value, (%), 2004–2011 65

Figure 47: Emerging Pharmaceutical Market – Brazil, PPD, Company Profile, 2011 67

Figure 48: Emerging Pharmaceutical Market – Brazil, PRA International, Company Profile, 2011 68

Figure 49: Emerging Pharmaceutical Market – Brazil, ICON, Company Profile, 2011 69

Figure 50: Emerging Pharmaceutical Market – Brazil, Theorem Clinical Research, Company Profile, 2011 70

Figure 51: Emerging Pharmaceutical Market – Brazil, PAREXEL, Company Profile, 2011 71

Figure 52:  Emerging Pharmaceutical Market – Brazil, Intrials, Company Profile, 2011 72

Figure 53: Emerging Pharmaceutical Market – Brazil, Eurotrials, Company Profile, 2011 73

Figure 54: Emerging Pharmaceutical Market – Brazil, PGS Medical/Statistics, Company Profile, 2011 74

Figure 55: Emerging Pharmaceutical Market – Brazil, INC Research, Company Profile, 2011 75

Figure 56: Emerging Pharmaceutical Market – Brazil, Chiltern, Company Profile, 2011 76

Figure 57: Emerging Pharmaceutical Market – Brazil, Covance, Company Profile, 2011 77

Figure 58: Emerging Pharmaceutical Market – Brazil, Quintiles, Company Profile, 2011 78