Price cuts coming but opportunity remains in Japanese pharma market.
Biennial price revisions will result in pharmaceutical price cuts in Japan this month but the world’s second largest pharmaceutical market still holds great opportunity for global pharma, according to latest analysis from Datamonitor Healthcare.
Price revisions are being considered this month in Japan, as part of the biennial alterations. During this process, additional price cuts are also implemented on the prices of drugs that achieved greater sales than initially forecast, due to changes in usage or target population.
Anantharaman Kavassery Viswanathan, analyst at Datamonitor Healthcare, said: “In this latest round of cuts the market expansion rule will impact 11 active ingredients (APIs) and 22 products which mostly include big-selling DPP-4 inhibitor antidiabetics and biologic therapies used mainly in rheumatoid arthritis. Overall, the average cut of 5.64% will be applied on a drug price basis in line with what was expected.
“As well as reducing prices for drugs already on the market, the ability to charge a premium for new products is becoming increasingly difficult in the complex regulatory environment. The number and size of premiums awarded have been declining: in 2013, only 15% of drugs priced through comparison-based pricing were awarded a premium, versus 50% in 2009.
“Despite these challenges, the world’s second largest pharmaceutical market presents a number of opportunities, including an aging population, together with a relatively low barrier to reimbursement compared to many EU markets.”
Posted in Strategy.