Though time and again one may say that Latin America's pharmaceuticals market is a fraction of the size of the United States market, with the economic recovery that is happening in Brazil along with Argentina, Brazil is raising hope for the Indian pharma manufacturers as the destination for their export and diversification strategies.
Brazil is becoming much more appealing as a place in which one can consider to conduct development and production.
Click here to view Table showing data on the Economies Of Latin America
In the entire Latin American Region, the economy of the Brazil is the second largest with a GDP size of $ 497.9 billion. Brazil occupies the first place in the entire Latin American region with a population of 182 million. However in terms of GDP per capita it has no significant place as it stands below the average GDP per capital of the Latin America.
Pharma potentail of Latin America : $ 21.8 billion.
Brazil's pharma industry Stands at $ 5.41 billion
(25% of Latin America's market)
Next to Mexico which has a pharma market size of $ 7.2 bn, Brazil has a pharma market of $ 5.41 nn. Brazil's market is of 25% size to the total Latin American pharma markets.
The per capita expenditure with reference to pharmaceuticals and healthcare shows that pharma expenditure wise Brazil occupies 5th place among the Latin American countries. In healthcare also it almost occupies 6th place.
Click here to view Table showing data on per capita expenditure on Pharmaceuticals And Healthcare
If we look at the kind of disease profile prevailing in Brazil we find that infectious diseases(excluding AIDS), cancer, diabetes, heart disease and strokes are some of the leading segments with which the Brazilian population is affected majorly.
The market is showing strong scope for growth. The United Nation projects the overall population of the region will increase by about 23% over the next 20 years. Mortality rates for cancer, heart disease and strokes and the incidence of diabetes are all increasing as a result of more sedentary lifestyles, smoking, drinking and obesity.
Demand for prescription drugs is consequently increasing as are therapy classes for cardiovascular and central nervous system illnesses. Classes for treatment of asthma are also experiencing similar growth.
To break into the region commercially, Latin America is as diverse as it is vast and effectively consists of sub regions each with distinctive and different characteristics. It is essential to understand the particular features of the target country. Brazil and Mexico are the two biggest markets and have stable economies, manufacturing experience and potential for growth are considered to be the good first targets.
As a means of testing the market it is advisable to form an alliance with a local company. Once companies have an established base they can use it as a gateway from which to move into other Latin American countries.
Rather than set up separate marketing and sales operations in numerous different places it is worth outsourcing these activities to domestic firms with a sound understanding of the local market. This has the advantage of minimizing the risks and costs associated with trading in a new territory.
The top 10 pharmaceutical companies account for only 42% of sales in Brazil. So a vast scope for other players to enter into the Brazilian Markets.
Strides Arcolab is the first one to enter Brazilian market. Other majors Ranbaxy and Torrent are fast exploring avenues in the Brazilian markets.
Currently leading Indian companies are actively considering to get into Brazil markets due to its its high price structure. The market share statistics of top 10 companies show that the rest -- 58% of the total of the available $ 5.41 bn market --is open for new players providing huge scope for the Indian companies.
Click here to view Table showing data on Mortality rates per 100,000 population, by cause, at the start of the 1980s and end of the 1990s for selected Latin American countries
-- The author is Country Head, Firstcall India Equity Advisors Pvt.Ltd, Mumbai, India.