South American market demand is a balance between acute and chronic drug portfolios. In the chronic therapy segment, drugs for cardiovascular diseases and diabetes make up the major share. Therapies for pain and gastric disorders account for the largest share of the acute therapy segment. Biocon’s product became the first insulin glargine to be approved in Mexico under the new Biocomparable Approvals Pathway defined in 2012, said Ravi Limaye, president, marketing,
Bicon Limited in an email interaction with Nandita Vijay. Excerpts:

How are the Indian companies faring in South American market ?
Most big Indian pharmaceutical companies have operations in the US$ 50 billion South American market, where Brazil and Venezuela are the two largest markets. These two markets are providing stable and consistent growth for Indian companies, which cumulatively generate annual sales of US$ 500 million from South America. Almost all Indian companies with significant direct presence in the geography have been outperforming with strong double-digit sales growth. Now this is a trend that appears likely to continue.

Could you give us a snapshot of the current scene in the region? What are the visible trends in this region?
While the overall South American pharma market has been growing at a modest pace, Venezuela is fast outpacing it with over 50 per cent annual growth. In fact, Venezuela and Brazil contribute to three-fourths of the sales from the geography.

In terms of therapy segments, the South American market is balanced between acute and chronic portfolios. In the chronic therapy segment, drugs for cardiovascular diseases and diabetes make up the major share. Therapies for pain and gastric disorders account for the largest share of the acute therapy segment.

A mix of novel and generic molecules make up the list of top-selling drugs in South America. As governments in South America try and bring down their per capita expenditure on healthcare, the generics opportunity could grow rapidly to a significant one in the next few years. Global spending on medicines is forecast to grow to nearly US$ 1.3 trillion in 2018 as per the IMS, with generic drugs making up 50-60% of this pie. About half the sales of generic drugs will be in highly regulated markets such as the US, the EU and Japan, with the US projected to grow at a CAGR of 5%-8% through 2018, according to IMS. Emerging markets like South America, Asia, Africa and East Europe are expected to account for a smaller share of the generics opportunity, however, sales are expected to grow faster at a CAGR of 8%-11%.

Moreover, with the regulatory pathway for biosimilars in advanced stages of finalization in a few important markets in South America, Indian-made biosimilars could potentially address a huge need for affordable access to these life-saving and life-enhancing therapies. Early this year, Biocon’s product became the first insulin glargine to be approved in Mexico under the new Biocomparable Approvals Pathway defined in 2012. This approval has opened up the opportunity for Biocon to address a market where the disease prevalence of diabetes is the second highest in the world.

What are the challenges to trade in this market?
Political instability in certain South American markets poses a challenge to long-term strategy making as well as short term execution.
How important is South America for Biocon and what are fastest growing products in the region? What are the likely future prospects that could emerge from this market?

Biocon covers almost all major markets in South America, which is an important geography for the company. Our products offer a safe, efficacious and affordable alternative to expensive drugs in South America, where most countries are challenged with a rising incidence of non-communicable diseases (NCDs) like diabetes, cancer and autoimmune disorders. The treatment costs of NCDs are simply unaffordable in many developing economies in South America where the ‘standard of care’ is equivalent to several months’ wages for a majority of the population. In these markets, Biocon’s immunosuppressants are expanding access to a larger patient pool.  We are well poised to establishing a strong presence in this region through our affordable APIs and generic formulations, which are aimed at helping individuals lower their out-of-pocket spend and governments bring down their per capita expenditure on healthcare.

In the last financial year, Biocon has widened its commercial footprint in South America by entering into several partnering arrangements for a wide range of our products. Moreover, we have identified strategic partners for biosimilars in key markets and also expanded existing partnerships in Argentina, Chile, Ecuador, Panama and other key markets in the region.

The partnerships for our biosimilars and generic insulins will help strengthen our presence in the region. The registration of key generic formulations in Brazil and Argentina is expected to generate reportable outcomes in FY16.

In South America, we expect to emulate our performance in Mexico where we have been playing a significant role in enabling access to affordable generic insulins. Biocon along with its partner, PiSA Farmaceutica, has played a significant role in enabling access to generic recombinant human Insulin over the last eight years in Mexico where over 70% of the population is overweight and prone to developing diabetes. The recent regulatory approval for our insulin glargine from COFEPRIS, the Mexican health authority, will provide diabetics care access to a generic basal insulin. It will thus expand the diabetes management therapy portfolio in Mexico, a country with over 9 million diabetes cases.