Inflation-Linked Bonds April
2003YungShin GroupYungShin Group
Decade Before and ThenDecade Before and Then
Fangchen Lee, PhD, MBAFangchen Lee, PhD, MBA
ChairmanChairman
Yung Shin Pharm. Ind. Co., Ltd.Yung Shin Pharm. Ind. Co., Ltd.
[email protected]@yungshingroup.com
2
AgendaAgenda
Healthcare Industry TrendsHealthcare Industry Trends
YungShin GroupYungShin Group
Strategies for the Next Decade Strategies for the Next Decade
Vertical Integration of Resources to Global Markets Vertical
Integration of Resources to Global Markets Acquisition of
Complimentary Acquisition of Complimentary Financial Leverage and
Stock Dilution Financial Leverage and Stock Dilution
3
4
Taiwan Market HighlightsTaiwan Market Highlights
Market > NT$ 100 B, CAGR in 11 years: 8.6%, HospitalMarket >
NT$ 100 B, CAGR in 11 years: 8.6%, Hospital--based market:
~78%based market: ~78%
The growth of market in 2006 The growth of market in 2006 only
3.1%only 3.1% resulting from continuous fierce resulting from
continuous fierce price cut of BNHI effective on Nov 1 of 2006price
cut of BNHI effective on Nov 1 of 2006
Fixed Fixed The amount being adjusted is in historical high at
around NT$ 9 The amount being adjusted is in historical high at
around NT$ 9 billionsbillions More than 5,359 items affectedMore
than 5,359 items affected
BNHI BNHI to to introducing the balance billing (or sointroducing
the balance billing (or so--called called ““Pay for the
DifferencePay for the Difference””))
The investigatThe investigation ofion of the black holethe black
hole (price difference) issue(price difference) issue by
prosecutor. by prosecutor. suggested BNHI to correct it from price
resuggested BNHI to correct it from price re--submission by
hospitals andsubmission by hospitals and pharmaceutical
pharmaceutical companiescompanies 1,339 pharmaceutical companies
and 5291,339 pharmaceutical companies and 529 hospitals are
requested to rehospitals are requested to re--submit their prices
for submit their prices for the confirmation and correctionthe
confirmation and correction prior the deadline set forth on Feb
15prior the deadline set forth on Feb 15
BNHI BNHI tto limit outpatiento limit outpatient access for flu
visits access for flu visits restricting flu drug reimbursement in
exception of agedrestricting flu drug reimbursement in exception of
aged people over 60 and age people over 60 and age below 3below
3
BNHI intends to increase insurance premium after Lunar New BNHI
intends to increase insurance premium after Lunar New
YearYear
The new scheme will inject BNHI an addition of NT$ 8 billions a The
new scheme will inject BNHI an addition of NT$ 8 billions a
yearyear,,
2nd generation NHI on the road2nd generation NHI on the road
↑↑ aging population, aging population, ↑↑ life style, oncology and
CNS drugs, life style, oncology and CNS drugs, ↑↑ Generic
substitutionGeneric substitution
5
Taiwan Pharmaceutical TrendTaiwan Pharmaceutical Trend
An industry where the market growth is dramatically decliningAn industry where the market growth is dramatically declining
Source: IMS 4Q, 2006Source: IMS 4Q, 2006
44.044.0 48.948.9 49.749.7
0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0
100.0 110.0
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
2. S2. S--AA
3. GSK3. GSK
1. Pfizer1. Pfizer
5. Roche5. Roche
6. A6. A--ZZ
4. 4. NovartisNovartis
8. Bayer8. Bayer
9. 9. WyethWyeth
7. MSD7. MSD
10. Yung Shin10. Yung Shin
((Top 10 Ranking)Top 10 Ranking) ((NT$, Bio.)NT$, Bio.) Total
market size in 2006: 108 BillionTotal market size in 2006: 108
Billion
11 Years CAGR from 1995 since NHI rolled out to 2005 is 8.6%, bu11
Years CAGR from 1995 since NHI rolled out to 2005 is 8.6%, but the
latest 5 years CAGR arrived t the latest 5 years CAGR arrived only
at only at 3.4%3.4% indicating market growth is dramatically
slowing down or could indicating market growth is dramatically
slowing down or could be even worsen years be even worsen years
onwardonward
6
Five Years Trend Five Years Trend ––
Hospital SectorHospital Sector
shown an improvement in 2006 by growing at midshown an improvement in 2006 by growing at midsingle digit of single digit of
5.6%5.6%
((SARS)SARS)
73,15273,627
80,28079,913
84,349
(0.4)
0.7
6.8
9.0
5.6
66,000
1.5
3.5
5.5
7.5
9.5
7
((SARS)SARS)
10,60510,960
9,826
3.4
5.5
0.4
13.9
(10.4)
0
2,000
4,000
6,000
8,000
10,000
12,000
2002 2003 2004 2005 2006 -12.0 -10.0 -8.0 -6.0 -4.0 -2.0 0.0 2.0
4.0 6.0 8.0 10.0 12.0 14.0
Clinic Sector Growth % (Growth %)
Five Years Trend Five Years Trend ––
Clinic SectorClinic Sector
kept sharply downward pattern continuouslykept sharply downward pattern continuously
Source: Source: IMS Data, 4Q, 2006IMS Data, 4Q, 2006
8
Five Years Trend Five Years Trend ––
Drugstore SectorDrugstore Sector
kept growth pattern at low single digit growth by 2.7%kept growth pattern at low single digit growth by 2.7%
((SARS)SARS)
10,373 11,610
12,273 13,42813,791
-3.0
-1.0
1.0
3.0
5.0
7.0
9.0
11.0
9
Top 10 ManufacturersTop 10 Manufacturers
YungShin is the only one local manufacturer on the listYungShin is the only one local manufacturer on the list
Sales Share % Growth % E.I. % Sales Share % Growth % E.I. % PFIZER
9,164,532,606 8.5 5 101 8,730,362,709 8.4 3 102
SANOFI-AVENTIS 6,582,453,144 6.1 5.4 102 6,244,180,794 6 -3.3
96
GLAXOSMITHKLINE 5,577,766,411 5.2 -2.9 94 5,746,755,194 5.5 -0.2
99
NOVARTIS 5,205,478,220 4.8 10.6 107 4,708,146,449 4.5 3.4 102
ROCHE 4,568,043,486 4.2 16.6 113 3,919,028,322 3.8 5.8 105
ASTRAZENECA 4,377,944,740 4.1 11.6 108 3,922,759,532 3.8 10.1
109
MERCK SHARP&DOHME 3,890,303,074 3.6 0.3 97 3,877,870,171 3.7
-12.4 87
BAYER 3,268,536,238 3 28.2 124 2,549,837,518 2.4 -2.6 96
WYETH/LEDERLE 2,693,731,155 2.5 7 103 2,518,573,828 2.4 9.9
109
YUNG SHIN 2,508,522,741 2.3 0.9 97 2,485,900,688 2.4 3.3 102
MAT 4Q2006 MAT 4Q2005
10
Top 10 Foreign ManufacturersTop 10 Foreign Manufacturers
Sales Share % Growth % E.I. % Sales Share % Growth % E.I. % PFIZER
9,164,532,606 11.3 5.0 99 8,730,362,709 11.4 3.0 103 SANOFI-AVENTIS
6,582,453,144 8.2 5.4 100 6,244,180,794 8.2 (3.3) 96
GLAXOSMITHKLINE 5,577,766,411 6.9 (2.9) 92 5,746,755,194 7.5 (0.2)
99 NOVARTIS 5,205,478,220 6.4 10.6 104 4,708,146,449 6.2 3.4 103
ROCHE 4,568,043,486 5.7 16.6 110 3,919,028,322 5.1 5.8 105
ASTRAZENECA 4,377,944,740 5.4 11.6 105 3,922,759,532 5.1 10.1 110
MERCK SHARP&DOHME 3,890,303,074 4.8 0.3 95 3,877,870,171 5.1
(12.4) 87 BAYER 3,268,536,238 4.1 28.2 121 2,549,837,518 3.3 (2.6)
97 WYETH/LEDERLE 2,693,731,155 3.3 7.0 101 2,518,573,828 3.3 9.9
110 LILLY 1,959,647,620 2.4 26.1 119 1,554,000,824 2.0 (4.1)
96
MAT 4Q2006 MAT 4Q2005
Source: Source: IMS Data, 4Q, 2006IMS Data, 4Q, 2006
Total growth rate for foreign manufacturers: 5.8%Total growth rate
for foreign manufacturers: 5.8%
11
Top 10 Local ManufacturersTop 10 Local Manufacturers
Sales Share % Growth % E.I. % Sales Share % Growth % E.I. % YUNG
SHIN 2,508,522,741 9.3 0.9 104 2,485,900,688 8.9 3.3 100
C.C.P.C 2,111,703,526 7.8 7.7 111 1,960,464,729 7.1 (0.1) 97
STANDARD 1,697,844,315 6.3 (2.1) 101 1,734,221,693 6.2 10.1
107
SINTONG 1,544,312,820 5.7 (14.6) 88 1,808,613,470 6.5 16.0
112
TUNG YANG 1,494,805,896 5.5 (1.0) 102 1,509,234,022 5.4 0.5
97
NANG KUANG 868,961,375 3.2 1.4 104 856,813,868 3.1 37.9 134
SINPHAR 731,921,638 2.7 33.9 138 546,700,459 2.0 15.4 112
EVEREST CHEM 626,410,195 2.3 (10.2) 92 697,688,138 2.5 11.9
108
ORIENT EUROPHARMA 565,527,968 2.1 11.4 115 507,699,813 1.8 11.6
108
PURZER 558,546,192 2.1 (2.0) 101 569,655,408 2.1 (1.3) 96
MAT 4Q2006 MAT 4Q2005
Source: Source: IMS Data, 4Q, 2006IMS Data, 4Q, 2006
Total growth rate for local manufacturers: Total growth rate for
local manufacturers: --2.9%2.9%
12
11XX Negative GainNegative Gain
StarsStars
Top 20 Therapeutic ClassesTop 20 Therapeutic Classes
2006 2005 Sales Share % Growth % E.I. % 1 1 C08A CALCIUM
ANTAGONISTS PLAIN 5,287,992,363 4.9 0.8 97
2 2 A10B ORAL ANTIDIABETICS 4,819,381,178 4.5 5.9 102
3 4 C10A CHOLEST&TRIGLY.REGULATOR 3,739,457,692 3.5 10
106
4 5 C09C ANGIOTENS-II ANTAG, PLAIN 3,598,600,691 3.3 9.4 106
5 8 L01X ALL OTH. ANTINEOPLASTICS 3,375,748,313 3.1 38.7 134
6 3 J01D CEPHALOSPORINS & COMBS 3,226,224,937 3 -8.9 88
7 6 A02B ANTIULCERANTS 2,911,104,594 2.7 0.2 97
8 9 N05A ANTIPSYCHOTICS 2,808,724,855 2.6 15.6 112
9 7 J01C BROAD SPECTRUM PENICILLIN 2,591,594,161 2.4 5.7 102
10 10 M01A ANTIRHEUMATIC NON-STEROID 2,179,242,037 2 -7.4 89
11 12 N06A ANTIDEPRESS.& MOOD STAB. 2,107,757,665 2 6.1
102
12 13 L01C VINCA ALKALOIDS 2,065,390,906 1.9 17.1 113
13 11 C07A BETA BLOCKING AGENT PLAIN 1,971,895,061 1.8 -2.2
94
14 17 B02D BLOOD COAGULATION 1,967,748,568 1.8 41.3 136
15 16 B01C PLATELET AGGREG INHIBITRS 1,559,138,559 1.4 10.2
106
16 18 N03A ANTI-EPILEPTICS 1,520,362,538 1.4 15.4 111
17 14 C09A ACE INHIBITORS PLAIN 1,485,367,314 1.4 -12.9 84
18 24 L01B ANTIMETABOLITES 1,422,364,558 1.3 36.7 132
19 19 J01G FLUOROQUINOLONES 1,401,466,195 1.3 7.2 104
20 15 A02A ANTACIDS ANTIFLATULENTS 1,303,814,255 1.2 -16.2 81
MAT 4Q2006RANKING THERAPEUTIC CLASS
14
Source: Source: IMS Data, 4Q, 2006IMS Data, 4Q, 2006
2006 2005 Sales Share % Growth % E.I. % 1 1 NORVASC PFZ
2,570,418,768 2.4 9.9 106
2 2 LIPITOR PFZ 1,346,596,124 1.3 6.3 103
3 3 DIOVAN NVR 1,337,251,039 1.2 10.8 107
4 5 PLAVIX S.A 881,177,561 0.8 8.1 104
5 8 GLIVEC NVR 861,504,163 0.8 23.3 119
6 6 AVANDIA GSK 842,100,156 0.8 3.9 100
7 4 COZAAR MSD 809,576,089 0.8 -12.3 85
8 7 APROVEL S.A 807,520,940 0.8 14 110
9 11 TAZOCIN WYL 779,872,504 0.7 15.2 111
10 10 TAXOTERE S.A 779,274,763 0.7 12.7 109
11 37 KOGENATE FS BAY 773,643,353 0.7 98.8 192
12 12 AMARYL S.A 750,729,088 0.7 11.9 108
13 19 RECORMON ROC 730,215,875 0.7 31.3 127
14 17 IRESSA AZN 682,548,551 0.6 20.7 117
15 15 RISPERDAL J-C 640,570,011 0.6 7.7 104
16 14 CIPROXIN BAY 609,633,073 0.6 -3.3 93
17 20 ADALAT OROS BAY 603,960,534 0.6 9.7 106
18 25 REDUCTIL ABT 601,246,424 0.6 24 120
19 9 VIAGRA PFZ 600,138,453 0.6 -13.7 83
20 16 DILATREND ROC 580,820,252 0.5 -1.7 95
RANKING Product Company MAT 4Q2006
15
11,942
25,733
10,715
11,948
12,404
30,607
11,921
13,322
12,427
35,217
13,818
14,899
12,561
37,457
13,391
15,728
12,358
40,507
12,293
15,808
9,456
46,539
13,201
17,595
9,837
49,391
13,085
17,644
10,473
56,436
16,030
21,243
10,839
57,183
16,763
22,022
20,000
40,000
60,000
80,000
100,000
120,000
Out-patients OPD Chronic Diseases OPD Others In-patients
95.05
13.9%13.9% 14.4%14.4% 14.6%14.6% 14.2%14.2% 15.1%15.1% 20.6%20.6%
24.5%24.5% 28.5%28.5% 0.4%0.4% 0.5%0.5% 0.7%0.7% 0.9%0.9% 0.7%0.7%
0.7%0.7% 0.8%0.8% 1.1%1.1% BA/BEBA/BE 0.9%0.9% 0.9%0.9% 1.1%1.1%
0.3%0.3% 0.6%0.6% 0.9%0.9% 0.7%0.7% 0.6%0.6% 0.6%0.6% 0.7%0.7%
0.7%0.7% 0.7%0.7% 1.1%1.1% 1.0%1.0% 1.4%1.4% 1.1%1.1% 15.7%15.7%
16.5%16.5% 17.1%17.1% 16.2%16.2% 17.4%17.4% 23.2%23.2% 27.5%27.5%
31.3%31.3% 34.2%34.2% 34.7%34.7% 36.1%36.1% 38.8%38.8% 39.4%39.4%
34.3%34.3% 32.7%32.7% 27.8%27.8% 3.2%3.2% 3.4%3.4% 3.2%3.2%
3.5%3.5% 3.6%3.6% 3.8%3.8% 4.0%4.0% 3.9%3.9% BA/BEBA/BE 9.3%9.3%
10.6%10.6% 11.4%11.4% 12.6%12.6% 13.3%13.3% 13.7%13.7% 13.6%13.6%
14.2%14.2% 37.3%37.3% 34.6%34.6% 31.9%31.9% 28.7%28.7% 26.0%26.0%
24.8%24.8% 22.0%22.0% 22.6%22.6% TPNTPN 0.3%0.3% 0.3%0.3% 0.2%0.2%
0.2%0.2% 0.3%0.3% 0.2%0.2% 0.2%0.2% 0.2%0.2% 84.3%84.3% 83.5%83.5%
82.9%82.9% 83.8%83.8% 82.6%82.6% 76.8%76.8% 72.5%72.5%
68.7%68.7%
100%100% 100%100% 100%100% 100%100% 100%100% 100%100% 100%100%
100%100%
17
1.1. 2.2.
NT$, Mio.NT$, Mio. ProductProduct
481481 473473 1,9331,933 4,0634,063 6,1216,121 8,4318,431
12,86312,863 16,69416,694 21,83421,834
LaunchLaunch
18
19
Global Pharmaceutical Industry OverviewGlobal Pharmaceutical Industry Overview
The generic drugs market which is expected to grow at 10%The
generic drugs market which is expected to grow at 10%--12% over the
next few years is a key 12% over the next few years is a key growth
area for emerging pharmaceutical manufacturersgrowth area for
emerging pharmaceutical manufacturers
Emerging TrendsEmerging Trends
Estimated to be a US$550 billion market in 2004 Estimated to be a
US$550 billion market in 2004 (including estimated (including
estimated unauditedunaudited pharmaceutical sales)pharmaceutical
sales)
•• Market expected to grow at a rate of 7% to 9%Market expected to
grow at a rate of 7% to 9%
Regulated markets account for almost 90% of the Regulated markets
account for almost 90% of the market in terms of revenuemarket in
terms of revenue
•• North America is the single largest market accounting for
approxNorth America is the single largest market accounting for
approx. . 50% of global sales and is expected to grow at a CAGR of
10%50% of global sales and is expected to grow at a CAGR of
10%
•• EU was the fastest growing market, growing at a CAGR of 26% in
EU was the fastest growing market, growing at a CAGR of 26% in the
period 2002 the period 2002 –– 2004 2004
Growing importance of generics in regulated marketsGrowing
importance of generics in regulated markets •• Pressure from
healthcare providers and insurance companies to Pressure from
healthcare providers and insurance companies to
reduce healthcare costs driving usage of generic drugsreduce
healthcare costs driving usage of generic drugs •• Increasing
patent expirations driving generic drug availabilityIncreasing
patent expirations driving generic drug availability •• Legislative
changes such as the enactment of the HatchLegislative changes such
as the enactment of the Hatch--Waxman Waxman
act and changes to the Medicare Act in the US providing a major act
and changes to the Medicare Act in the US providing a major
boostboost
Stringent testing requirements and declining R&D Stringent
testing requirements and declining R&D productivity has led to
limited new drug pipeline productivity has led to limited new drug
pipeline
•• Increasing pressure on big pharmaceutical companies to
Increasing pressure on big pharmaceutical companies to enhance new
drug pipelineenhance new drug pipeline
204204 230230 248248
20022002 20032003 20042004 North AmericaNorth America EUEU
JapanJapan Rest of EuropeRest of Europe Rest of WorldRest of
World
U S$
Global Pharmaceutical Sales*Global Pharmaceutical Sales* CAGR CAGR
–– 13.7%13.7%
Source: IMS World Review (Industry Sales based on Audited Source:
IMS World Review (Industry Sales based on Audited
Numbers)Numbers)
Key Generic Drug MarketsKey Generic Drug Markets
24.824.8
5.75.7
5.35.3
4.14.1
3.33.3
2.52.5
1.91.9
USUS
IndiaIndia
GermanyGermany
UKUK
JapanJapan
ItalyItaly
FranceFrance
20002000 20012001 20022002 20032003 20082008 CAGR %CAGR %
20032003--20082008
EthicalEthical 317.1 317.1 363.4 363.4 401.0401.0 437.6437.6
677.8677.8 9.19.1 GenericsGenerics 24.024.0 27.027.0 30.5 30.5
37.037.0 64.064.0 11.611.6 OTC OTC 70.570.5 73.873.8 78.578.5
82.082.0 101.0101.0 4.34.3
BBiopharmaceuticalsiopharmaceuticals 22.1 22.1 26.3 26.3 31.031.0
36.536.5 58.658.6 9.99.9 Total World Total World MarketMarket 433.7
433.7 490.5 490.5 541.0 541.0 593.1 593.1 901.4901.4 8.78.7
((US$,B)US$,B)
21
Worldwide Pharmaceutical MarketWorldwide Pharmaceutical Market
Global Pharmaceutical Market is still Growing, but Global Pharmaceutical Market is still Growing, but
Under PressureUnder Pressure
Sales Growth will vary greatly region by regionSales Growth will
vary greatly region by region
North America North America 55--8% 8% 315315--370370
Europe (All) Europe (All) 55--8% 8% 205205--240240
Asia/Africa/Australia Asia/Africa/Australia 99--12% 12%
7575--9090
Japan Japan 33--6% 6% 6565--8080
Latin America Latin America 77--10% 10% 3535--4545
Total World Total World 55--8% 8% 710710--820820
CAGR CAGR 2004~20092004~2009
US$ B.US$ B. 200920095 5 Years OutlookYears Outlook
Source: IMS Knowledge Link Q4, 2005 MATSource: IMS Knowledge Link
Q4, 2005 MAT
22
Top 10 Key Markets in the WorldTop 10 Key Markets in the World
20052005
Rank Rank 20012001
Rank Rank 20052005
Share Share 20052005
Rank Rank 20012001
Rank Rank 20052005
Share Share 20052005
45%45%1111
11%11%2222
5.7%5.7%3333
5.5%5.5%4444
3.6%3.6%5555
3.5%3.5%6666
2.7%2.7%7777
2.4%2.4%8888
1.6%1.6%991010
1.3%1.3%101099
Most of countries maintain their ranking, expect China has overMost
of countries maintain their ranking, expect China has over--passed
Mexico in 05passed Mexico in 05
Source: IMS Knowledge Link Q3 2005 MATSource: IMS Knowledge Link Q3
2005 MAT
23
Negative publicity (pricing, safety, manufacturing,
accounting)Negative publicity (pricing, safety, manufacturing,
accounting)
Recent blockbusters satisfy unmet needsRecent blockbusters satisfy
unmet needs Slowed approvals (and decreased submissions) result in
fewer newSlowed approvals (and decreased submissions) result in
fewer new product launchesproduct launches
Increasing chronic diseases caring and emphasizing patient
qualiIncreasing chronic diseases caring and emphasizing patient
quality of lifety of life Generics and failed patent extensions
rapidly erode marketGenerics and failed patent extensions rapidly
erode market CostCost--containment measures and economic slowdowns
continuecontainment measures and economic slowdowns continue
Price increase in US marketPrice increase in US market Continued
government policy interventionContinued government policy
intervention DTC expenses in US is decliningDTC expenses in US is
declining
Health care cost is under increased pressureHealth care cost is
under increased pressure
Large parts of the GP initiated prescribing will be off patentLarge
parts of the GP initiated prescribing will be off patent
Payers will find ways to benefit more from the patent
expirationPayers will find ways to benefit more from the patent
expirations s –– both through higher penetration and lower
priceboth through higher penetration and lower price
Eastern Europe are already largely generic Eastern Europe are
already largely generic –– the segment growth will the segment
growth will due to this be slowerdue to this be slower
The generic industry will show continued fast growth The generic
industry will show continued fast growth –– but also fast but also
fast change due to competitionchange due to competition
BiosimilarsBiosimilars will take a relatively smaller part of the
market but with will take a relatively smaller part of the market
but with better pricesbetter prices
24
GlobalGlobal
generic sales reached an generic sales reached an
estimated US$ 61 Billion in 2005 estimated US$ 61 Billion in 2005
USA representing half of the USA representing half of the
marketmarket
Western Europe
Asia 13%
Global Generic Market (*): US$ 61B. (2005)Global Generic Market
(*): US$ 61B. (2005) Global Generic Market (2): US$ 77B.
(2005)Global Generic Market (2): US$ 77B. (2005)
Adding Adding ““other brandsother brands”” (2) for emerging
market(2) for emerging market
25
G en
er ic
p ri
Absolute Low Price ZoneAbsolute Low Price Zone
Major Generic Market DistributionMajor Generic Market Distribution
26
19.8%19.8% 48.5%48.5%
27
Estimated Global Generic Sales by Co. Estimated Global Generic Sales by Co.
SandozSandoz
head in value ; head in value ; TevaTeva
leads in volumeleads in volume
U S
bi lli
28
%
S$ )
29
Market Segment in Asia PacificMarket Segment in Asia Pacific
Local Manufacturers Local Manufacturers vsvs
Foreign ManufacturersForeign Manufacturers
Taiwan is dominated by foreign manufacturersTaiwan is dominated by
foreign manufacturers
90%90%
90%90%
85%85%
75%75%
70%70%
65%65%
55%55%
35%35%
25%25%
10%10%
15%15%
25%25%
30%30%
35%35%
45%45%
65%65%
75%75%
10%10%
Cost Containment
CostCost ContainmentContainment
Healthcare Reform
HealthcareHealthcare ReformReform
Industry Consolidation IndustryIndustry
Global M&AGlobal M&A Distribution network
consolidationDistribution network consolidation
Increased demand of efficiency to drive cost downIncreased demand
of efficiency to drive cost down CoCo--marketing and comarketing
and co--promotionpromotion
31
Key Challenges in Asia Pacific MarketKey Challenges in Asia Pacific Market
PricingPricingPricing
(China, India, Indonesia)(China, India, Indonesia)
32
Critical Issues Affecting Generic Markets Critical Issues Affecting Generic Markets
Over the Next 10 YearsOver the Next 10 Years
Price erosion will continue; less in added value Price erosion will
continue; less in added value segmentssegments
Medicare/Medicaid in the USAMedicare/Medicaid in the USA
Blockbusters increasingly coming in specialty driven Blockbusters
increasingly coming in specialty driven marketsmarkets
Weak primary care launches threaten long term generic Weak primary
care launches threaten long term generic potentialpotential
OTC cannibalization of genericsOTC cannibalization of
generics
Low cost manufacturing and maintaining sustainable Low cost
manufacturing and maintaining sustainable marginsmargins
Slow emergence of protocols and adoption for Slow emergence of
protocols and adoption for biosimilarsbiosimilars
33
Factors Favoring Generics in Asia PacificFactors Favoring Generics in Asia Pacific
Highest price in the world Highest price in the world ––
differential of only 20% in Australia, differential of only 20% in
Australia, Korea and Taiwan Korea and Taiwan –– doubledouble--edged
sword edged sword –– less erosion of branded less erosion of
branded productsproducts First generics get large market share
Government endorsement First generics get large market share
Government endorsement –– generics favored and used for reference
pricing to contain costsgenerics favored and used for reference
pricing to contain costs of of increased drug consumption in
chronic diseases where brands increased drug consumption in chronic
diseases where brands dominatedominate Improvement in GMP and
distributionImprovement in GMP and distribution Higher margin
allows for nonHigher margin allows for non--transparent discounting
and transparent discounting and ““purchase of prescriptionspurchase
of prescriptions”” among domestic companies among domestic
companies especially in dispensing marketsespecially in dispensing
markets Better acceptance by physiciansBetter acceptance by
physicians BiogenericsBiogenerics are less regulated and already
launched in Australia, are less regulated and already launched in
Australia, China,Korea and IndiaChina,Korea and India
34
The future of Generics in Asia PacificThe future of Generics in Asia Pacific
Emerging new regional players will drive more shareEmerging new regional players will drive more share
MNCsMNCs :: SandozSandoz WinthropeWinthrope ––
SanofiSanofi--AventisAventis Merck KGAAMerck KGAA TevaTeva
Asian :Asian : RanbaxyRanbaxy WockhardtWockhardt UnilabUnilab
YangzhizhangYangzhizhang SamyangSamyang Dong ADong A YungShin
GroupYungShin Group
35
Pharmaceutical Pharmaceutical
NutraceuticalsNutraceuticals
Favorable demographics Favorable demographics –– the ageing
peoplethe ageing people Acceleration of R&D
spendingAcceleration of R&D spending Continued consolidation
and strategic alliancesContinued consolidation and strategic
alliances DirectDirect--toto--consumer (DTC) pushconsumer (DTC)
push Internet emerges as key marketing toolInternet emerges as key
marketing tool Managed care gets tough on drugsManaged care gets
tough on drugs Trend in CMOTrend in CMO Regulation Regulation
harmonization with higher requirementharmonization with higher
requirement
37
Favorable DemographicsFavorable Demographics
Aging baby boomers and lengthening life span will Aging baby
boomers and lengthening life span will generate powerful
demandgenerate powerful demand
Over 60 crowd to rise from 606 million in 2000 to 2 Over 60 crowd
to rise from 606 million in 2000 to 2 billion in 2050billion in
2050
Over 65 in US expected to expand 53% from 2001 to Over 65 in US
expected to expand 53% from 2001 to 2020 vs. overall population
growth of 17 % (Over 65 2020 vs. overall population growth of 17 %
(Over 65 crowd accounts for 16 % of US population, but 33 % crowd
accounts for 16 % of US population, but 33 % of all prescriptions
written)of all prescriptions written)
38
Baby Boomers Driving DemandBaby Boomers Driving Demand
Source: U.S. Census Bureau, HCAB 2002Source: U.S. Census Bureau,
HCAB 2002
Approximate Age Distribution of Baby BoomersApproximate Age
Distribution of Baby Boomers
Small leading edge Small leading edge begin to increase begin to
increase
utilizationutilization
2525 4545
3535 5555
Nearly half now Nearly half now needing greater needing
greater
health care health care attentionattention
20002000
39
Acceleration of R&D SpendingAcceleration of R&D Spending
Pharmaceutical Industry (1994 Pharmaceutical Industry (1994 ––
2003)2003)
0
10
20
30
40
50
60
Source: PHRMASource: PHRMA
Note: Annual R&D expenditures Note: Annual R&D expenditures
adjusted to reflect 2003 equivalence.adjusted to reflect 2003
equivalence.
New Drug ApprovalsNew Drug Approvals
Industry R&D spendingIndustry R&D spending
Central nervous system Central nervous system -- 26%26%
Neoplasm, endocrine system, Neoplasm, endocrine system, metabolic
metabolic -- 21%21%
CardiovascularCardiovascular -- 18%18%
Respiratory system Respiratory system -- 10%10%
Digestive Digestive -- 4%4%
40
Target ID &Target ID & ValidationValidation
DrugDrug DiscoveryDiscovery PrePre--clinical clinical INDIND
Clinical phase IClinical phase I Clinical IIClinical II--IVIV NDA
&NDA &
MarketMarket
““Valley of DeathValley of Death””
The average cost The average cost of developing a of developing a
new drug in the new drug in the Western countries Western countries
has reached has reached approximately $1 approximately $1
billionbillion ““PharmaPharma Innovation GapInnovation Gap””
““Valley of DeathValley of Death””
The The ““innovation gapinnovation gap”” continues to plague the
pharmaceutical industry.continues to plague the pharmaceutical
industry.
41
19891989 BristolBristol--Myers SquibbMyers Squibb
SmithklineSmithkline BeechamBeecham
19931993 Rhone Rhone PoulencPoulenc--RorerRorer
19981998 Roche/Roche/BoehringerBoehringer MannheimMannheim
20012001 Abbott/KnollAbbott/Knoll BMS/DupontBMS/Dupont
19991999 AventisAventis AstraZenecaAstraZeneca
SanofiSanofi--SynthelaboSynthelabo
FunctionalFunctional
““Getting back to basicsGetting back to basics”” and concentration
on and concentration on core, high margin core, high margin
pharmapharma productsproducts
Divest Divest ““noncorenoncore”” businesses, such as businesses,
such as AgrichemicalsAgrichemicals
Molecular biology and Molecular biology and genomics discoveries
genomics discoveries have made strategic have made strategic
alliances more pervasivealliances more pervasive
42
DirectDirecttotoConsumer PushConsumer Push
FDA relaxed DTC advertising in 1997FDA relaxed DTC advertising in
1997
Ad spending $2.27 billion in 2000 (41 percent Ad spending $2.27
billion in 2000 (41 percent increase over 1999)increase over
1999)
They want you to say to They want you to say to
your doctor your doctor –– ““I want I want
VioxxVioxx”” or or ““you know, you know,
the purple pillthe purple pill””
PayersPayers HealthHealth agentsagents
Internet Key Marketing toolInternet Key Marketing tool
Today all Today all pharmaspharmas have product information on
their have product information on their website or through web
partnership such as website or through web partnership such as
WebMDWebMD, , use this medium to promote use this medium to promote
pharmapharma to MDsto MDs
More than 75 % of US doctors report that patients bring More than
75 % of US doctors report that patients bring Internet printouts to
their office visits.Internet printouts to their office
visits.
82.6%
69.2%
69.0%
51.8%
23.5%
Specialists or hospitals
InformatioInformatio n Patients n Patients Bring to Bring to
MDsMDs
44
Web Delivery / MultiWeb Delivery / Multi--LanguageLanguage
SPCSPC (EU)(EU)
BNFBNF EPEP
PatientPatient InsertsInserts
(US)(US)PILsPILs (EU)(EU)
ComplianceCompliance DossiersDossiers
PatientPatient InfoInfo
PhysicianPhysician InfoInfo
The goal:The goal: common data sources for common data sources
for
multiple documents in multiple documents in multiple
languagesmultiple languages
A question:A question: can this be done across and can this be done
across and
between between pharmapharma companies?companies?
Internet key marketing toolInternet key marketing tool
Restrictions on accessRestrictions on access Call saturationCall
saturation 10 percent of contacts10 percent of contacts 20 percent+
growth per annum20 percent+ growth per annum
Rarely leveraged for valueRarely leveraged for value The health
information sourceThe health information source
BB--toto--B, BB, B--toto--C, BC, B--toto--EE Low cost/high
serviceLow cost/high service Going mobileGoing mobile
Sales ForceSales Force
Call CenterCall Center
US$25US$25 per contactper contact
US$1US$1 per contactper contact
Sales force is the most costly promotion nowadaysSales force is the
most costly promotion nowadays
46
Managed Care Gets Tough on DrugsManaged Care Gets Tough on Drugs
Managed care is key market Managed care is key market –– 70 percent
all 70 percent all retail prescriptions to retail prescriptions to
pharmapharma
Fastest growing expenseFastest growing expense
New cost and control strategies being New cost and control
strategies being developeddeveloped
Higher coHigher co--pay for more expensivepay for more expensive
Use collective purchasing power on bulk Use collective purchasing
power on bulk purchasespurchases
47
Hospitals intend
Hospitals intend
to secure
to secure
profita bility
fro m
profita bility
fro m
Drug suppliers
Drug suppliers
hospitals
hospitals
How can a pharmaceutical company How can a pharmaceutical company
mitigate the risk of pricing pressure on mitigate the risk of
pricing pressure on
its growth?its growth?
2005 price Ex-mnf Euros %SU PRICE %SU PRICE %SU PRICE %SU PRICE %SU
PRICE %SU PRICE %SU PRICE
Branded 23% 0.77 51% 0.94 12% 1.23 26% 1.03 44% 1.02 61% 0.73 71%
0.98
Generics 77% 0.35 49% 0.21 88% 0.06 74% 0.05 56% 0.14 39% 0.42 29%
0.84
TOTAL 0.45 0.58 0.2 0.31 0.52 0.61 0.94
UK Spain GreeceGermany Norway Sweden Denmark
TaiwanTaiwan
48
Price Pressures will Drive ConsolidationsPrice Pressures will Drive Consolidations
in order to Maintain Earning Levelsin order to Maintain Earning Levels
Sales Sales
Price Pressures limitsPrice Pressures limits Industry ability to
use Industry ability to use
price for growthprice for growth
Industry continues toIndustry continues to consolidate in order
toconsolidate in order to
cut infrastructure costs:cut infrastructure costs: --Reduce sales
reps Reduce sales reps -- Eliminate TA areasEliminate TA
areas
in Researchin Research --Reduce duplication in Reduce duplication
in
support functionssupport functions
Capital valueCapital value
““Companies are outsourcing Companies are outsourcing to
concentrate on to concentrate on marketing their productsmarketing
their products””
““Spending less time in drug Spending less time in drug discovery
and discovery and manufacturingmanufacturing””
““Virtual companies exist by Virtual companies exist by the simple
fact that they the simple fact that they can rely on the contract
can rely on the contract manufacturers and manufacturers and
researchersresearchers””
Source: Source: RBRB--203 Pharmaceutical Contract Manufacturing and
Research203 Pharmaceutical Contract Manufacturing and Research,,
BUSINESS COMMUNICATIONS COMPANY, INCBUSINESS COMMUNICATIONS
COMPANY, INC Published: April 2005Published: April 2005
CROCRO
Contract Contract FormulatorFormulator
company)company)
* * Note: Some CMONote: Some CMO’’s offer more than one s offer
more than one service such as formulation, analytical and service
such as formulation, analytical and regulatory expertiseregulatory
expertise
Owns the knowOwns the know--howhow
Manages technology transferManages technology transfer
Needs short term capacity:Needs short term capacity: Unexpected
salesUnexpected sales Launch quantitiesLaunch quantities Limit risk
on new Limit risk on new technologiestechnologies
Contract ManufacturerContract Manufacturer
EquipmentEquipment LabourLabour Specific technologySpecific
technology
51
and research for the and research for the pharmaceutical
pharmaceutical
industry was estimated industry was estimated at $100 billion in
2004 at $100 billion in 2004 and is expected to rise and is
expected to rise at an average annual at an average annual
growth rate ofgrowth rate of 10.8% to $168 billion in 10.8% to $168
billion in
20092009””
Source: Source: RBRB--203 Pharmaceutical Contract Manufacturing and
Research203 Pharmaceutical Contract Manufacturing and Research,,
BUSINESS COMMUNICATIONS COMPANY, INCBUSINESS COMMUNICATIONS
COMPANY, INC Published: April 2005Published: April 2005
Emerging countries Emerging countries like India and soon like
India and soon
China will provide low China will provide low cost products that
will cost products that will
meet meet cGMPcGMP’’ss
The old business The old business model will not sustain model will
not sustain
growth for North growth for North American CMOAmerican
CMO’’ss
The new business The new business model is more complex model is
more complex and requires different and requires different
Pharmaceutical Pharmaceutical cGMPscGMPs for the 21for the 21stst
CenturyCentury Bioterrorism ActBioterrorism Act
Title III: Protecting Safety & Security of Food & Drug
SupplyTitle III: Protecting Safety & Security of Food &
Drug Supply
21 CFR Part 11 Scope and Application Guidance21 CFR Part 11 Scope
and Application Guidance Bar Code Label Requirements for Human
Drugs and BloodBar Code Label Requirements for Human Drugs and
Blood Strengthened commitment to international harmonization
activitieStrengthened commitment to international harmonization
activitiess
EU Mutual Recognition Agreement effective June 20, 1997, Final REU
Mutual Recognition Agreement effective June 20, 1997, Final Rule
(21 CFR Part 26) ule (21 CFR Part 26) effective December 7,
1998effective December 7, 1998 Confidentiality Agreement and
Implementation Plan to facilitate Confidentiality Agreement and
Implementation Plan to facilitate regulatory cooperation regulatory
cooperation between EU and FDA/DHHS for medicinal products for
human use (fibetween EU and FDA/DHHS for medicinal products for
human use (finalized nalized September 2004)September 2004) General
Principles for EMEAGeneral Principles for EMEA--FDA Parallel
Scientific Advice Meetings FDA Parallel Scientific Advice Meetings
–– Pilot Program Pilot Program (September 2004)(September
2004)
FDA final report on FDA final report on ““Combating Counterfeit
DrugsCombating Counterfeit Drugs””, , February 18, 2004February 18,
2004
FDA to create independent Drug Safety Oversight Board (DSB)FDA to
create independent Drug Safety Oversight Board (DSB)
““PharmacogenomicPharmacogenomic Data SubmissionsData
Submissions””,, Final Guidance, March 22, 2005Final Guidance, March
22, 2005
First laboratory test for genotyping approved by FDAFirst
laboratory test for genotyping approved by FDA
FDA Notable Actions & EventsFDA Notable Actions & Events
54
PrinciplesPrinciples RiskRisk--based orientationbased orientation
ScienceScience--based policies and standards based policies and
standards (incorporate up(incorporate up--toto--date science, and
encourage advances in date science, and encourage advances in
technology)technology) Integrated quality systems
orientationIntegrated quality systems orientation International
cooperationInternational cooperation Strong public health
protectionStrong public health protection
Broad ActionsBroad Actions External review of existing External
review of existing cGMPscGMPs, and product review practices, and
product review practices Reassess and reevaluate current scientific
approach to Reassess and reevaluate current scientific approach to
cGMPscGMPs and and product review processproduct review process
Emphasize riskEmphasize risk--based control point analysis and
facilitate latest based control point analysis and facilitate
latest innovations in pharmaceutical engineeringinnovations in
pharmaceutical engineering
55
Immediate StepsImmediate Steps Encouraging innovation by allowing
certain manufacturing processEncouraging innovation by allowing
certain manufacturing process changes without prior FDA
review/approvalchanges without prior FDA review/approval Enhancing
expertise in pharmaceutical technologiesEnhancing expertise in
pharmaceutical technologies Exploring better mechanisms for
communicating deficiencies to Exploring better mechanisms for
communicating deficiencies to industryindustry 21 CFR Part 11 lead
shifted to CDER (Chaired by Joe 21 CFR Part 11 lead shifted to CDER
(Chaired by Joe FamulareFamulare)) Including product specialists in
inspection teamsIncluding product specialists in inspection teams
Centers to provide reviews of all Warning LettersCenters to provide
reviews of all Warning Letters Developing a technical dispute
resolution processDeveloping a technical dispute resolution process
Emphasizing riskEmphasizing risk--based approach in work planning
processbased approach in work planning process FDA is encouraging
industries to adopt new technologies such as FDA is encouraging
industries to adopt new technologies such as Process Analytical
Technologies (PAT) to improve manufacturing Process Analytical
Technologies (PAT) to improve manufacturing efficiency and overall
quality of the drug productefficiency and overall quality of the
drug product
56
21 21 CFR Part 11 GuidanceCFR Part 11 Guidance
Scope & Application GuidanceScope & Application Guidance
Withdrew preceding draft guidance and Compliance Policy
GuideWithdrew preceding draft guidance and Compliance Policy Guide
Specific definition of records subject to Part 11Specific
definition of records subject to Part 11 Enforcement Discretion to
be exercised for:Enforcement Discretion to be exercised for: ––
Audit TrailsAudit Trails –– EE--copies of Ecopies of
E--recordsrecords –– Record RetentionRecord Retention ––
ValidationValidation Effectively grandfathers systems in place
prior to August 20, 19Effectively grandfathers systems in place
prior to August 20, 199797 Emphasis on decision based on documented
risk assessment Emphasis on decision based on documented risk
assessment 21 CFR Part 11 and preceding guidance subject to
review,21 CFR Part 11 and preceding guidance subject to review,
Regulations are likely to be revised, but have not
changedRegulations are likely to be revised, but have not
changed……YET!YET!
57
MotivationMotivation Medication errors are a huge problemMedication
errors are a huge problem
–– 770,000 patients injured or die annually770,000 patients injured
or die annually –– Cost to treat was $177.4 billion in 2002Cost to
treat was $177.4 billion in 2002
Bar coding to unit of use level ensures right patient gets the rBar
coding to unit of use level ensures right patient gets the right
ight drug at the right timedrug at the right time FDA estimates
rule will prevent 500,000 adverse events and FDA estimates rule
will prevent 500,000 adverse events and transfusion errors and save
$93 billion in healthcare costs overtransfusion errors and save $93
billion in healthcare costs over next next 20 years20 years
Final RuleFinal Rule ““Bar Code Label for Human Drug Products and
BloodBar Code Label for Human Drug Products and Blood””, 21 CFR
Parts , 21 CFR Parts 201,606, and 610201,606, and 610 Finalized
February 25, 2004Finalized February 25, 2004
58
NutraceuticalNutraceutical
59
The Global The Global NutraceuticalsNutraceuticals
Industry is Industry is
$196 Billion$196 Billion
Source: Nutrition Business Journal/Source: Nutrition Business
Journal/BurrillBurrill & Company& Company
Supplements 34%
Latin America
Australia/ NZ
P er
ce nt
ag es
P er
ce nt
ag es
60
Food and Lifestyle can Influence Food and Lifestyle can Influence
our Genes and How they Workour Genes and How they Work
Diet Diet –– Gene InteractionsGene Interactions
Exercise Exercise –– Gene InteractionsGene Interactions
61
GenotypingGenotyping
of of PredispositionPredisposition
Health & Wellness Health & Wellness management against a
set of management against a set of
personalized personalized biomarkersbiomarkers
Biomarker monitoringBiomarker monitoring
Personalized nutritionPersonalized nutrition
62
Many New Players in an Emerging MarketMany New Players in an Emerging Market
Alternative HealthAlternative Health DS CompaniesDS Companies
Health and Health and WellnessWellness MarketMarket
Fo od
C om
pa ni
Dietary supplementsDietary supplements M ed
ica l F
In Summary:In Summary:
8 Overarching Global Trends8 Overarching Global Trends
Range of Range of Marketplace Marketplace
ImpactsImpacts
Payers constrain and shift Payers constrain and shift
pharmaceutical spendpharmaceutical spend
Shifting balance of powerShifting balance of power in an evolving
healthcare in an evolving healthcare decisiondecision--maker
networkmaker network
Elevated regulatory hurdlesElevated regulatory hurdles
Challenges toChallenges to Intellectual PropertyIntellectual
Property
Changing public expectations Changing public expectations and
negative industry imageand negative industry image
Growing global interdependency Growing global interdependency and
transparency driven by and transparency driven by
technology evolutiontechnology evolution
64
65
A combination of strong chemistry skills, regulatory capabilitieA
combination of strong chemistry skills, regulatory capabilities and
quality manufacturing has s and quality manufacturing has
positioned India favorably to capitalize on the global
pharmaceupositioned India favorably to capitalize on the global
pharmaceutical opportunitytical opportunity
Indian Pharmaceutical Indian Pharmaceutical Market OverviewMarket
Overview
Approximately US$5 Approximately US$5 bnbn in 2004 with in 2004
with exports accounting for an additional exports accounting for an
additional US$2.5 US$2.5 bnbn •• Amongst top 4 markets by Amongst
top 4 markets by
volume globallyvolume globally Strong branded generics marketStrong
branded generics market Market growing at a rate 6%Market growing
at a rate 6%--8% as a 8% as a result of growing awareness, result
of growing awareness, increasing penetration & increasing
increasing penetration & increasing affordabilityaffordability
•• Emerging segments such as Emerging segments such as
CNS, diabetes etc. growing at 15CNS, diabetes etc. growing at 15--
20% +20% +
Introduction of product patents in Introduction of product patents
in India in 2005 are expected to lead to India in 2005 are expected
to lead to a greater emphasis on drug a greater emphasis on drug
discovery and development discovery and development
G row
th O pportunities
Generic Exports and API OutsourcingGeneric Exports and API
Outsourcing India is well positioned to target generic exports
India is well positioned to target generic exports and API
outsourcing opportunities in the regulated and API outsourcing
opportunities in the regulated marketsmarkets
Skilled work force with strong chemistry skillsSkilled work force
with strong chemistry skills Significant and sustainable cost
advantage over Significant and sustainable cost advantage over
international peers international peers Good understanding of the
regulatory frameworkGood understanding of the regulatory
framework
•• India has largest number of US FDA approved India has largest
number of US FDA approved plants outside the US plants outside the
US
•• Largest number of DMF filings outside US Largest number of DMF
filings outside US •• Indian companies are among the leading
players Indian companies are among the leading players
participating in Para IV challengesparticipating in Para IV
challenges
R&D OutsourcingR&D Outsourcing Skilled work force at
competitive costs Skilled work force at competitive costs
Significant progress in development of Significant progress in
development of pharmapharma & & R&D infrastructure over
last 5 yearsR&D infrastructure over last 5 years Focus on early
stage processes for Focus on early stage processes for NCEsNCEs,
NDDS, , NDDS, clinical trials, process reclinical trials, process
re--engineering and dedicated engineering and dedicated
manufacturingmanufacturing
55
66
State of Innovation:State of Innovation: Innovation historically
has been in process Innovation historically has been in process
improvement improvement However, there are a growing number of
However, there are a growing number of patents and publications
from government and patents and publications from government and
academic labsacademic labs
IndiaIndia
Innovation is IncreasingInnovation is Increasing
Indian Patents & PublicationsIndian Patents &
Publications
00 5050
19 91
19 91
19 92
19 92
19 93
19 93
19 94
19 94
19 95
19 95
19 96
19 96
19 97
19 97
19 98
19 98
19 99
19 99
20 00
20 00
20 01
20 01
20 02
20 02
India AdvantageIndia Advantage
Large skill baseLarge skill base Experts in process chemistry
Experts in process chemistry Long history of reverse Long history
of reverse engineeringengineering
Vast talent poolVast talent pool Sheer number of scientistsSheer
number of scientists Motivated & English speakingMotivated
& English speaking Large number of trained Indians Large number
of trained Indians returning home from North returning home from
North America and EuropeAmerica and Europe
Unmatched cost Unmatched cost competitivenesscompetitiveness
Lower cost of infrastructure and Lower cost of infrastructure and
skilled manpowerskilled manpower Vertical integrationVertical
integration
Strong local industryStrong local industry Growing expertise with
international Growing expertise with international regulatory
complianceregulatory compliance High quality manufacturing with
High quality manufacturing with abundant capacitiesabundant
capacities
SpeedSpeed Very strong entrepreneurial spiritVery strong
entrepreneurial spirit Hungry for growth and recognitionHungry for
growth and recognition Quick learners and fast moversQuick learners
and fast movers
Availability of capitalAvailability of capital Stock market has
seen Stock market has seen unprecedented growth in the last
unprecedented growth in the last decadedecade Continues to be
bullish on the Continues to be bullish on the pharmapharma
industryindustry
68
Selected FDA Approved Plants Selected FDA Approved Plants
Outside the U.S.Outside the U.S.
Source: Source: BusinessworldBusinessworld
IsraelIsrael
HungaryHungary
TaiwanTaiwan
ChinaChina
SpainSpain
ItalyItaly
IndiaIndia
6161
6060
2525
2222
99
55
77
69
70
China becoming outsourcing center for drug China becoming
outsourcing center for drug development and
manufacturingdevelopment and manufacturing
PrePre--clinical costs in China are, on average, 20% of the
U.S.clinical costs in China are, on average, 20% of the U.S. Big
Big pharmaspharmas are rapidly increasing outsourcing to China
(e.g. Eli Lilly)are rapidly increasing outsourcing to China (e.g.
Eli Lilly) Special resources: e.g. primates, large Special
resources: e.g. primates, large ““untesteduntested”” patients
populationpatients population
ChinaChina’’s domestic market becoming significants domestic market
becoming significant Western pharmaceuticals market will become top
5 by 2010 Western pharmaceuticals market will become top 5 by 2010
Healthcare system privatized; insurance industry boomingHealthcare
system privatized; insurance industry booming Largest patient
baseLargest patient base
China is developing its own expertiseChina is developing its own
expertise First gene therapy approved in China: First gene therapy
approved in China: GendicineGendicine by Shenzhen by Shenzhen
SiBionoSiBiono GenTechGenTech Chemistry services: Chemistry
services: WuxiWuxi PharmaTechPharmaTech Traditional Chinese
Medicine (TCM): Traditional Chinese Medicine (TCM):
BaiyunshanBaiyunshan Hutchison TCM Hutchison TCM
CHINACHINA
BECOMING A SIGNIFICANT FORCEBECOMING A SIGNIFICANT FORCE
71
10,52910,529
4,5094,509
2,7192,719
1,9841,984
1,9801,980
1,8691,869
1,8211,821
1,7211,721
13,78313,783
2,7902,790
7,3347,334
3,2913,291
2,3922,392
1,7361,736
1,7251,725
1,6201,620
1,4621,462
1,4491,449
10,33210,332
2,2742,274
4444
3737
1515
2525
1515
1414
1010
1414
1919
1919
China Has A Large And Rapidly China Has A Large And Rapidly
Growing EconomyGrowing Economy Projected Projected
Accumulative GDP Accumulative GDP Growth (2004Growth (2004--2010)
%2010) %
Average Average 17%17%
Real GDP in US$ billions (Based on Purchasing Power Parity)Real GDP
in US$ billions (Based on Purchasing Power Parity) 20042004
U.S.U.S.
JapanJapan
GermanyGermany
FranceFrance
U.S.U.S.
JapanJapan
GermanyGermany
FranceFrance
U.K.U.K.
ItalyItaly
ChinaChina
BrazilBrazil
IndiaIndia
RussiaRussia
72
Unprecedented Growth in China Life Unprecedented Growth in China Life
Sciences MarketsSciences Markets
Source: IMS; Frost & Sullivan; E&Y; literatures search,
World BSource: IMS; Frost & Sullivan; E&Y; literatures
search, World Bank; ank; BurrillBurrill Analysis, Goldman Sachs,
BCGAnalysis, Goldman Sachs, BCG
20002000 20052005 20102010
20002000 20052005 20102010
Total Health Care SpendingTotal Health Care Spending ((US Billion
Dollars)US Billion Dollars)
Total Pharmaceutical MarketTotal Pharmaceutical Market ((US Billion
Dollars)US Billion Dollars)
CAGR CAGR 16%16%
CAGR CAGR 17%17%
Total Medical Devices MarketTotal Medical Devices Market ((US
Billion Dollars)US Billion Dollars)
CAGR CAGR 19%19%
CAGR CAGR 19%19%
•• 55thth largest largest pharmaceutical pharmaceutical market by
2010 market by 2010 (Boston Consulting (Boston Consulting
Group)Group)
•• 33rdrd largest medical largest medical devices market by devices
market by 2010 (Goldman 2010 (Goldman Sachs)Sachs)
•• Excellent Excellent investment and investment and merchant
banking merchant banking opportunitiesopportunities
3434
150150
7070
China Life Sciences StrengthsChina Life Sciences Strengths
Low costs in drug R&D and manufacturingLow costs in drug
R&D and manufacturing
High growth potential in domestic market driven by High growth
potential in domestic market driven by aging population and
improved personal incomeaging population and improved personal
income
Large researcher talent pool with technology and Large researcher
talent pool with technology and industry knowledge and skills
industry knowledge and skills
Strong central and local government support, with Strong central
and local government support, with favorable tax policies and
grants favorable tax policies and grants
Special strengths: Gene therapy, stem cell research, Special
strengths: Gene therapy, stem cell research, Traditional Chinese
Medicine (TCM), chemistry Traditional Chinese Medicine (TCM),
chemistry servicesservices
74
ChinaChina’’s market size for ethical & OTC drugs in USD
Billions market size for ethical & OTC drugs in USD
Billion
Source: Boston Consulting GroupSource: Boston Consulting
Group
ChinChineseese PharmaPharma
Market To Become Market To Become
No. 5 World Wide by 2010No. 5 World Wide by 2010
346346TotalTotal 66ChinaChina 88MexicoMexico 88CanadaCanada
99SpainSpain
1313ItalyItaly 1414UKUK 1919FranceFrance 2020GermanyGermany
5353JapanJapan
196196USAUSA 2002 Top 102002 Top 10
447447TotalTotal 1010SpainSpain 1010CanadaCanada 1010BrazilBrazil
1414ChinaChina 1515ItalyItaly 1616UKUK 2121FranceFrance
2424GermanyGermany 6565JapanJapan
262262USAUSA 2005 Top 102005 Top 10
731731TotalTotal 1515BrazilBrazil 1616SpainSpain 1717CanadaCanada
2323ItalyItaly 2424UKUK 2424ChinaChina 2828FranceFrance
3737GermanyGermany 8181JapanJapan
466466USAUSA 2010 Top 102010 Top 10
75
Company ProfileCompany Profile
Founder : Mr. TienFounder : Mr. Tien--Te Lee Te Lee (Retired in
2004)(Retired in 2004)
Chairman & President: Dr. Fangchen Lee Chairman &
President: Dr. Fangchen Lee
Incorporation: August 1965Incorporation: August 1965
TSE Listing : May 1993TSE Listing : May 1993
No. of Employee: around 960No. of Employee: around 960
77
Integrating Group FacilityIntegrating Group Facility Fermentation
FacilityFermentation Facility Cephalosporin and Penicillin
FacilityCephalosporin and Penicillin Facility
HighHigh--hypersensitive Product Facilityhypersensitive Product
Facility (Anti(Anti--cancer, Hormone and Steroid)cancer, Hormone
and Steroid) APIAPI’’s Facilitiess Facilities Diagnostics Product
FacilityDiagnostics Product Facility
ANDA in Northern America for Generic MarketANDA in Northern America
for Generic Market
PIC/S and PIC/S and cGMPcGMP ComplianceCompliance
InterInter--affiliates R&D and affiliates R&D and
ManufManuf. Integration. Integration
Projects for Integrating GlobalizationProjects for Integrating Globalization
78
Major Overseas InvestmentsMajor Overseas Investments
Yung Zip Chemical Ind. Co., Ltd.Yung Zip Chemical Ind. Co., Ltd.
APIs and APIs and ExcipientExcipient
Carlsbad Technology Inc.Carlsbad Technology Inc. California, USA
since 1994California, USA since 1994
Yung Shin Pharm. Ind. (Yung Shin Pharm. Ind. (KunshanKunshan) )
Co., Ltd.Co., Ltd.
JiangSuJiangSu, China since 1994, China since 1994
79
Main Office: Kuala Lumpur, Malaysia since 1984Main Office: Kuala
Lumpur, Malaysia since 1984 Territory: Malaysia, Philippines,
Singapore, Territory: Malaysia, Philippines, Singapore, Thailand,
Vietnam, Myanmar, Cambodia, Thailand, Vietnam, Myanmar, Cambodia,
IndonesiaIndonesia
Yung Shin Company LimitedYung Shin Company Limited Hong Kong, since
1985Hong Kong, since 1985 Various medicine and agricultural
products Various medicine and agricultural products
Shanghai Yung Zip Pharmaceutical Trading Co., Ltd.Shanghai Yung Zip
Pharmaceutical Trading Co., Ltd. Shanghai, China since
1994Shanghai, China since 1994 Export/ import of API since
1994Export/ import of API since 1994
80
AnalgesicsAnalgesics Phase I: ongoing (Taiwan)Phase I: ongoing
(Taiwan) Phase I: progressing (USA)Phase I: progressing (USA)
Cold sore reliefCold sore relief prepre--IND granted (USA)IND
granted (USA) waiting for phase I trial (USA)waiting for phase I
trial (USA)
AntiAnti--cancercancer IND submission (AntiIND submission
(Anti--HIF, USA)HIF, USA) Phase II: Waiting for process
comparability (AntiPhase II: Waiting for process comparability
(Anti--angiogenesis, angiogenesis, USA)USA)
81
SWOT AnalysisSWOT Analysis
close and related to the Asianclose and related to the
Asian--Pacific market that Pacific market that growing up
fastgrowing up fast
domestic fund is still called sufficient, the will of domestic fund
is still called sufficient, the will of investment is high, the
family property person investment is high, the family property
person participates in the will vigorouslyparticipates in the will
vigorously
rich foundation and experience that developed the rich foundation
and experience that developed the industry in the pastindustry in
the past
experienced manufacturing and well established experienced
manufacturing and well established distribution channels in
Adistribution channels in A--PP
Excellent reputation in the fieldExcellent reputation in the
field
it needs for a long time to be absorbed to grow it needs for a long
time to be absorbed to grow industry's biotechnology of the skill,
investors may industry's biotechnology of the skill, investors may
not be able to bear waiting for a long timenot be able to bear
waiting for a long time
the execution of the relevant method of the the execution of the
relevant method of the intelligence proprietary, has not reached
the intelligence proprietary, has not reached the advanced
country's leveladvanced country's level
lack of experience of international marketing and lack of
experience of international marketing and
operationsoperations
insufficient of connection with insufficient of connection with
MNCsMNCs low sales effectiveness of generic sales forcelow sales
effectiveness of generic sales force less R&D outcome from the
huge investment less R&D outcome from the huge investment
YSP plant grants for YSP plant grants for cGMPcGMP and FDA
inspectionand FDA inspection great growth opportunities worldwide
for generic great growth opportunities worldwide for generic
productsproducts well established branches in Awell established
branches in A--P and USAP and USA increasing ageing people that
impel the demand of increasing ageing people that impel the demand
of
the medical product to increase the medical product to increase
getting strong demands of CMO from getting strong demands of CMO
from MNCsMNCs
the domestic relevant production cost is relatively the domestic
relevant production cost is relatively high, cause the
competitiveness to be lowhigh, cause the competitiveness to be
low
face the competition of the low steps products face the competition
of the low steps products from developing country and of the
highfrom developing country and of the high--order order products
in the advanced countryproducts in the advanced country
potential production competition from India and potential
production competition from India and mainland China due to their
huge size of mass mainland China due to their huge size of mass
productionproduction
price erosion from BNHI cost containmentprice erosion from BNHI
cost containment Increasing expenses in R&D as well as
marketing Increasing expenses in R&D as well as marketing
generic products generic products
5
10
15
20
25
(NT$Mio.)(NT$Mio.) (%)(%)
83
YSP Taiwan
Brances Net Sales EBIT Net Profit CYI 478 91 19%
YSK 130 0.3 0.2%
YSPSAH 881 133 11%
Animal DrugsAnimal Drugs 9%9%
Human DrugsHuman Drugs 82%82%
OthersOthers 1%1%
APIAPI 2%2%
FoodFood 6%6%
Y/e DecY/e Dec 20052005 2006E2006E yoyyoy
Sales Sales EBITDAEBITDA
Net DebtNet Debt Enterprise ValueEnterprise Value
9090 8888 --2%2% 2525 2424 --5%5% 28% 28% 27%27% 1414 2121 48%
48%
16%16% 24%24% 223223 --1212 210210
Source: Company data & BloombergSource: Company data &
Bloomberg
Focus on Alimentary track & metabolism, Focus on Alimentary
track & metabolism, CardiovascularsCardiovasculars, urology,
anti, urology, anti--infectivesinfectives,, CNS, CNS,
dermatologicalsdermatologicals, hormones, oncology,, hormones,
oncology, MusculoMusculo--skeletal, skeletal,
parasitologyparasitology, respiratory, respiratory & sensory
organs& sensory organs
Research focus: Herbal medicines, food Research focus: Herbal
medicines, food Supplements, slow release medicines,
APIs,Supplements, slow release medicines, APIs, AntiAnti--cancer
medicinescancer medicines
85
Benchmark Benchmark ––
Dr. ReddyDr. Reddy’’s Lab. Ltd. s Lab. Ltd.
Source: Company data & BloombergSource: Company data &
Bloomberg
RussiaRussia 15%15%
IndiaIndia 34%34%
OthersOthers 17%17%
Y/e MarchY/e March 20062006 2007E2007E yoyyoy
Sales Sales EBITDAEBITDA
Net DebtNet Debt Enterprise ValueEnterprise Value
549 549 13631363 148%148% 4242 267267 535%535% 8% 8% 20%20% 3737
144144 291% 291% 7%7% 11%11%
2,8222,822 616616
Research focus: Metabolic disorders, Research focus: Metabolic
disorders, cardiologycardiology
Established in 1984Established in 1984
86
Benchmark Benchmark ––
Dr. ReddyDr. Reddy’’s Lab. Ltd. s Lab. Ltd.
Strategic AnalysisStrategic Analysis
StrengthsStrengths –– Drug discovery, research, Drug discovery,
research, energingenerging strength in strength in
biotechnology, USFDAbiotechnology, USFDA--approved manufacturing
facilityapproved manufacturing facility WeaknessWeakness –– A lack
of marketing presence in the US, DRL is A lack of marketing
presence in the US, DRL is
building critical mass in its US and European building critical
mass in its US and European operationsoperations
OpportunitiesOpportunities –– Large US market for generics; other
nonLarge US market for generics; other non--regulated
regulated
markets I.e. China, Brazil, CIS, Russia and Indiamarkets I.e.
China, Brazil, CIS, Russia and India ThreatsThreats –– Increase
competition in the generics segment in the Increase competition in
the generics segment in the
US; slowdown in the number of drugs going offUS; slowdown in the
number of drugs going off--patent patent in the futurein the
future
RoW formulations
Revenue Breakdown, FY08FRevenue Breakdown, FY08F
Competitive PositionCompetitive Position Supplier PowerSupplier
Power –– Superior backwardSuperior backward--integrated
manufacturing facilities approved by integrated manufacturing
facilities approved by
FDA; no problem with new material suppliesFDA; no problem with new
material supplies
Barriers to EntryBarriers to Entry –– Strong R&D background
focusing on new drug discoveries, legal Strong R&D background
focusing on new drug discoveries, legal
expertise, strength in chemical synthesis difficult to
replicateexpertise, strength in chemical synthesis difficult to
replicate
Customer PowerCustomer Power –– Key products have pricing power in
US, the lower the price, the Key products have pricing power in US,
the lower the price, the
higher the market shareshigher the market shares
Substitute ProductsSubstitute Products –– Old products are
substitutable, a need to innovate constantly toOld products are
substitutable, a need to innovate constantly to
launch complex productslaunch complex products
RivalryRivalry –– Strong competition from varies players that are
entrenched in thStrong competition from varies players that are
entrenched in the e
advanced markets that DRL is targeting advanced markets that DRL is
targeting
87
Trends 2006: Where are we today?Trends 2006: Where are we today?
Many companies are still only looking for pure labor Many companies
are still only looking for pure labor arbitragearbitrage
How low will the vendors go?How low will the vendors go?
The smart ones are looking for valueThe smart ones are looking for
value How can I improve my processes?How can I improve my
processes? How can I develop new revenue opportunities?How can I
develop new revenue opportunities?
Many buyers want bestMany buyers want best--ofof--breed rather than
a single breed rather than a single providerprovider
Most buyers use between two and five offshore Most buyers use
between two and five offshore providers to manage demand and
pricingproviders to manage demand and pricing
88
Strategies for the Next DecadeStrategies for the Next Decade
Vertical integration of resources to global Markets Vertical integration of resources to global Markets
Acquisition of complimentary Acquisition of complimentary
Financial leverage and stock dilution Financial leverage and stock dilution
Goals of each 5Goals of each 5years termyears term
89
API ExportsAPI Exports
office office developmentdevelopment
Global Global generics generics suppliersupplier
new R&D new R&D center at center at IndiaIndia Distribution
Distribution
companies or companies or partners at partners at Australia,
Australia, South South America and America and AfricaAfrica
NCE NCE developer developer and and supplier, 1 supplier, 1
meme--too NCE too NCE every yearevery year
Extreme the existing strength Extreme the existing strength
manufacturing for regulated manufacturing for regulated market US,
EU and Japanmarket US, EU and Japan Product licensingProduct
licensing--in for The in for The
Group Group New R&D center in ChinaNew R&D center in China
Distribution companies at China, Distribution companies at
China,
US or EU or MidUS or EU or Mid--EastEast Distribution partner at
Japan or Distribution partner at Japan or
EU or MidEU or Mid--East East
90
SFA and eSFA and e-- business Roll outbusiness Roll out
Strengthen Strengthen Presence in Presence in
Lifestyle DrugsLifestyle Drugs
Penetrate Penetrate Regulated Regulated
and nicheand niche
SustainableSustainable GrowthGrowth
- Chronic - High Risk Group
PatientsPatientsPatientsSemi-PatientsSemiSemi--PatientsPatientsHealth
PeopleHealth PeopleHealth People
Disease Disease ManagementManagement
Health Health ManagementManagement
92
Penetrate Regulated Markets by M&APenetrate Regulated Markets by M&A
New Markets/ Initiatives:New Markets/ Initiatives: Enter Advanced
Markets/ establish onEnter Advanced Markets/ establish on--shore
presence in 5 shore presence in 5 select marketsselect markets oo
EUEU oo JapanJapan oo AustraliaAustralia oo South AfricaSouth
Africa oo Latin AmericaLatin America
Acquisition:Acquisition: oo Brands in USBrands in US oo Businesses
in select countries of EUBusinesses in select countries of EU oo
DomesticDomestic
RegulatorsRegulators
IndustryIndustry
SuppliersSuppliers
93
Enhance Research (ANDA, NDDS and NCE)Enhance Research (ANDA, NDDS and NCE)
New chemical entity in TaiwanNew chemical entity in Taiwan
New dosage form /New deliver pathwayNew dosage form /New deliver
pathway
Authorized brand genericAuthorized brand generic
11stst generic in potential generic in potential TCsTCs
Distributorship of patent productsDistributorship of patent
products
94
GPGP
Value Value Creation Creation through through
ExecutionExecution
Performance Performance ManagementManagement
Employee RetentionEmployee Retention Recruiting, induction and
training costsRecruiting, induction and training costs Central HR
administration costsCentral HR administration costs Sales value and
volume per repSales value and volume per rep
Sales value and volume per repSales value and volume per rep
Employee satisfactionEmployee satisfaction Employee
retentionEmployee retention
Sales Force Sales Force Effectiveness Effectiveness
Va lu
e Tr
ee Va
lu e
Tr ee
ProcessProcessManagementManagement AreaArea
WorkforceWorkforce ManagementManagement
Competency Competency ManagementManagement
Sales value and volume per repSales value and volume per rep
CrossCross--selling and share of customer walletselling and share
of customer wallet Time to competencyTime to competency Cost per
training hour and training cost per Cost per training hour and
training cost per reprep
Alignment of culture, values, people performanceAlignment of
culture, values, people performance
Average cost of recruitment per repAverage cost of recruitment per
rep Average ROI of individuals recruitedAverage ROI of individuals
recruited Number of right candidates accepting job Number of right
candidates accepting job offers offers
Efficiency and productivity per repEfficiency and productivity per
rep Maximise impact against business metricsMaximise impact against
business metrics
Costs through longer tenureCosts through longer tenure Cost of
recruitingCost of recruiting
Time available for conducting roleTime available for conducting
role Average travel and meeting timeAverage travel and meeting
time
ConversionsConversions Sales value per rep Sales value per rep
Cross sellingCross selling Average meeting preparation
lengthAverage meeting preparation length ConversionsConversions
Sales value per rep Sales value per rep Cross sellingCross selling
Average travel and meeting timeAverage travel and meeting
time
Cost of Sales Cost of Sales
Win Rate Win Rate
Forecasting Accuracy Forecasting Accuracy
Customer Retention Customer Retention
Business ImpactBusiness Impact
“…“…....the way management treats the associates (employees) is
exactly the way management treats the associates (employees) is
exactly how the associates will treat the customers. And if the
associathow the associates will treat the customers. And if the
associates es treat the customers well, the customers will return
again and agtreat the customers well, the customers will return
again and again, and that is where the real profit liesain, and
that is where the real profit lies”” (Sam Walton, founder of
Wal(Sam Walton, founder of Wal--Mart)Mart)
96
DOMESTIC FORMULATIONSDOMESTIC FORMULATIONS
11stst brand generic in potential brand generic in potential
TCsTCs
Reduce pricing pressure on Reduce pricing pressure on
‘‘olderolder’’ moleculesmolecules
Brands/ differentiated productsBrands/ differentiated
products
higher growth than market (E.I. > 100)higher growth than market
(E.I. > 100)
In Licensing/ coIn Licensing/ co--marketingmarketing
GENERICS BUSINESSGENERICS BUSINESS
Define tender business operation Define tender business operation
platformplatform
Aggressive build up of productsAggressive build up of
products
Acquisition/ mergerAcquisition/ merger
CONTRACT MANUFACTURINGCONTRACT MANUFACTURING
Creative our license dealsCreative our license deals
Product acquisitionProduct acquisition
ENHANCE RESEARCHENHANCE RESEARCH
CoCo--development/ licensedevelopment/ license--inin
High Investment/ Long gestationHigh Investment/ Long
gestation
Integration efforts among groupIntegration efforts among
group
R&D center in China/ IndiaR&D center in China/ India
YungShinYungShin GroupGroup
97
Future PerspectivesFuture Perspectives
Asia is a diverse region with potential for YungShin group with Asia is a diverse region with potential for YungShin group with
operations in 15(18) Countriesoperations in 15(18) Countries
AustraliaAustralia
YSPSAHYSPSAH 881881 1,4181,418
YZCYZC 290290 467467
Average annual Average annual growth rate: 10%growth rate:
10%
99
Thanks Very Much for Your Kind Attention !Thanks Very Much for Your Kind Attention !
Fangchen Lee, PhD, MBAFangchen Lee, PhD, MBA
ChairmanChairman
Yung Shin Pharm. Ind. Co., Ltd.Yung Shin Pharm. Ind. Co., Ltd.
[email protected]@yungshingroup.com
YungShin GroupDecade Before and Then
Agenda
Taiwan Market Highlights
Taiwan Pharmaceutical TrendAn industry where the market growth is
dramatically declining
Top 10 Foreign Manufacturers
Top 10 Local Manufacturers
Worldwide Pharmaceutical MarketGlobal Pharmaceutical Market is
still Growing, but Under Pressure
Top 10 Key Markets in the World- 2005
Factors Affecting Global Market Growth
Global generic sales reached an estimated US$ 61 Billion in
2005
Western Europe Generic Penetration
Estimated Global Generic Sales by Co. Sandoz head in value ; Teva
leads in volume
Few Players with a “Global” ProfileMost are very regional
Market Segment in Asia PacificLocal Manufacturers vs Foreign
Manufacturers
Critical Issues Affecting Generic Markets Over the Next 10
Years
Factors Favoring Generics in Asia Pacific
The future of Generics in Asia PacificEmerging new regional players
will drive more share
Healthcare Industry Trends- Pharmaceutical - - Nutraceuticals
-
Healthcare industry trend : Pharma
Direct-to-Consumer Push
Pricing Pressure: the Biggest Challenge
Price Pressures will Drive Consolidationsin order to Maintain
Earning Levels
New trend in Contract Manufacturing
Traditional relationship
Opportunities Threats
FDA Notable Actions & Events
21 CFR Part 11 Guidance
Bar Coding Regulations
The Global Nutraceuticals Industry is $196 Billion
Food and Lifestyle can Influence our Genes and How they Work
The Emerging Health & Wellness Market
Many New Players in an Emerging Market
In Summary:8 Overarching Global Trends
Factors driving the Indian Pharmaceutical Industry
IndiaInnovation is Increasing
China Has A Large And Rapidly Growing Economy
Unprecedented Growth in China Life Sciences Markets
China Life Sciences Strengths
China’s market size for ethical & OTC drugs in USD
Billion
YungShin Group
Company Profile
SWOT Analysis
Benchmark – Dr. Reddy’s Lab. Ltd.
Benchmark – Dr. Reddy’s Lab. Ltd.
Trends 2006: Where are we today?
Strategies for the Next Decade - Vertical integration of resources
to global Markets - Acquisition of complimentary - Fina
Strategic Goals
Business Strategy
Penetrate Regulated Markets by M&A
Enhance Research (ANDA, NDDS and NCE)
Tough Environment for Sales Management
Sales Force Automation
YungShin Group – Emerging Scenario
Future Perspectives Asia is a diverse region with potential for
YungShin group with operations in 15(18) Countries
Thanks Very Much for Your Kind Attention !