HEALTH SYSTEM
Argentina
According to 2004 World Health Organization statistics, total healthcare expenditure as a percentage of GDP stood at an impressive 9.6%. At 45.4%, that is at the same level as it was cited in Robles's book. The majority of private healthcare expenditure 54.6% was borne by private insurance companies. As of 2006, there were nearly 95,000 doctors in the country. However, the number of doctors per 1,000 people was recorded at 0.4, which leaves further scope for improvement. Argentina has an impressive number of paramedical and nursing staff, who largely cater to the needs of the rural belt of the country. Infant and maternal mortality was recorded highest in the rural belts of the country. This indicates that there are still health care inequities present in Argentina.
The government's healthcare expenditure has been low, and has a minority stake in the total healthcare expenditure in Argentina. Urban healthcare needs are largely catered by private institutions. The healthcare expenditure increased from $18 billion in 2006 to $20 billion in 2007; however, healthcare expenditure as a percentage of GDP decreased from 8.3% in 2006 to 8% in 2007.
Brazil
As it is cited in Robles’s book, Brazil faces worst inadequacies. This statement still persists in the present. In spite of the government’s attempts to improve the health standards of the people in the under-developed regions, Brazil’s overall health indicators remain grim. The health status of people in the impoverished northern regions of the country is significantly low. The government’s initiatives towards combating the threat of HIV/AIDS, however, have been largely successful. Despite this, there is scope for further improvement. Prenatal diseases are the principal causes behind high infant mortality rate in the under-developed regions.
Patent Protection
Developing a fertile environment for innovation is vital for Brazil, and the need for intellectual property rights (IPR) protection is equally important. However, concerns of IPR violation have been evident in the healthcare sector, among others. In May 2007, for instance, the Brazilian government broke the patent on an AIDS drug developed and produced by Merck and Co., and the controversial regulatory decision did not bode well for the US companies interested in doing business in Brazil. According to a survey compiled by Interfarma, Brazil's pharmaceutical manufacturers association, research-based multinational drug companies have been reducing their investment in Brazil since 2003. The survey reveals that the combined total R&D investment of these companies in Brazil in 2003 was approximately R160 million ($82 million). However, in 2007, the R&D spend was R140 million (approximately $72 million). The 2007 figures represent a decline from 2006. Concerns over IPR and government price controls have been the major reasons behind the decline in R&D investment by drug companies. Therefore, weak IPR protection will increase the nervousness of investors, which might lead to declining investments not only in the healthcare sector but other sectors as well.
Mexico
Despite trying out various schemes to provide an impetus to the overall availability of healthcare services across the country, insufficient healthcare facilities, particularly in the rural areas, continue to be a problematic area.
Robles cited that in Mexico, about two-thirds of the population is covered by the social security system, but Calderon government has announced that all Mexicans will be under the universal health coverage by 2011. The universal healthcare system will provide public insurance to all the Mexicans. Furthermore, this system will not only reduce the out of pocket spending but also improve the efficiency of the system. More importantly, the universal healthcare system is intended to provide quality healthcare and also indicates an equitable distribution of resources.
PHARMACEUTICAL MARKET
Regional trends
Source: Espicom Business Intelegnence, Robles
*Calculated as: ( -1)*100 = 11.46 %
We can notice that the pharmaceutical market in Latin America is growing at above average growth rates. Total Pharmaceutical Market size for the seven countries grew from 20 billion in 2000 to almost 38 billion in 2006, which means that the market grew at a rate of almost 11 percent per year on average. If we compare this to the data in Robles’s book, where compound average growth rate for years between 2000 and 2005 is projected at 7.8%, we can notice that the market grew at a 3 percentage points higher rate.
The only market that is under the estimates is the Argentinean market, which was projected to grow at a compound rate of 3.8%, but it grew only at a half of this rate – that is 1.9%. Mexican market grew 1 percentage point above the projected rate of 12.9%. The most outstanding markets are Brazilian, Chilean and Peruvian. Brazilian market compound average growth rate was projected at 4.6%, but the market grew at a rate of 11.5%. Both, Chilean and Peruvian markets grew at over 2 times as projected growth rates
Robles stated that Mexico is projected to be the most dynamic by far, with a compound average growth of almost 13% in the 2000-2005 period versus less than 5% in Brazil. It is clear that Brazilian market escalated and achieved compound average growth of 11.5%, and that most dynamic markets are Peruvian and Venezuelan with a compound average growth rate of over 16%.
Mexico
The Mexican pharmaceutical market has grown at a fluctuating rate throughout the period 2000-2008. Data monitor projects that Mexican pharmaceutical market will continue on a similar course of growth with a slight deceleration during the period 2008-2013. The alimentary/metabolism segment was the market's most lucrative in 2008, generating total revenues of $2.2 billion, equivalent to 21.9% of the market's overall value. The central nervous system segment contributed revenues of $1.3 billion in 2008, equating to 13.3% of the market's aggregate revenues. The performance of the market is forecast to follow a similar pattern, with an anticipated CAGR of 8.6% for the five-year period 2008-2013, which is expected to drive the market to a value over $15 billion by the end of 2013.
The Mexican market of pharmaceuticals accounts for 3.1% of the Americas pharmaceuticals market’s value. In comparison, USA pharmaceuticals market holds 85.8% of the market’s revenue and Canadian holds 7.6% of the market's revenue.
Pfizer Inc. is the leading company in Mexican pharmaceuticals market with 10.1% of the market’s value. GlaxoSmithKline Plc holds further 8.5% of the Mexican pharmaceuticals market’s share, which equals to the share of Eli Lilly and Company. The fourth largest pharmaceutical producer in Mexico is Sanofi-Aventis SA with 7.70% of the market's value. Consequently all other companies share amounts 65.2%.
Brazil
The Brazilian pharmaceutical market has experienced a steady growth in the period 2000-2008 and is likely to continue to grow in the forecast period, with a slight decrease in the growth rate. The Brazilian pharmaceutical market generated total revenues of $13.2 billion in 2008, representing a compound annual growth rate (CAGR) of 8.8% for the period spanning 2000-2008. The alimentary/metabolism segment was the market's most lucrative in 2008, generating total revenues of almost $1.7 billion, equivalent to 15.1% of the market's overall value. The central nervous system segment contributed revenues of $1.5 billion in 2008, equating to 13.6% of the market's aggregate revenues. The performance of the market is forecast to decelerate, with an anticipated CAGR of 8.4% for the five-year period 2008-2013, which is expected to drive the market to a value of $16.8 billion by the end of 2013.
The Brazilian market of pharmaceuticals accounts for 3.5% of the Americas pharmaceuticals market’s value, this is 0.4% more than Mexican market.
Novartis AG is the leading company in Brazilian pharmaceuticals market with 9.1% of the market’s value. The second largest share in the Brazilian pharmaceuticals market holds GlaxoSmithKline Plc with 8.3% of the market's value. Third place takes EMS Sigma Pharma with 7.5% market's value share and the fourth position holds Pfizer Inc with a share of 6.1% of the market's value. All other companies combined share amounts 69.1%.
CONCLUSION
It is evident that that the Latin American pharmaceutical market has grown since Robles has published his book. But the market is not mature yet, it has plenty potential left to grow. On this fact large international pharmaceutical are keen to get the biggest share of the emerging market. What is common to all the Latin American countries, are the local pharmaceutical companies that do not respect patent protection, but will change in the future. And when that time comes, Latin America will be most prosperous pharmaceutical market.
REFERENCES
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Datamonitor. (2008). Country Analysis Report Argentina. Retrieved from http://www.marketline.com/
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Datamonitor. (2008). Country Analysis Report Brazil. Retrieved from http://www.marketline.com/
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Datamonitor. (2008). Country Analysis Report Mexico. Retrieved from http://www.marketline.com/
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Datamonitor. (2008). Industry profile: Global Pharmaceuticals. Retrieved from http://www.marketline.com/
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Datamonitor. (2008). Industry profile: Pharmaceuticals in Mexico. Retrieved from http://www.marketline.com/
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Datamonitor. (2008). Industry profile: Pharmaceuticals in Brazil. Retrieved from http://www.marketline.com/
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Robles, F., Simon, F., Haar J. (2002). Winning Strategies in the New Latin-American Markets. New Yearsy: FT Press
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Swan, C. Pharma Markets in Latin American Countries. Retrieved 5 January 2009 from web site: http://www.pharmexcil.com/v1/docs/TechSes-II/PharmamarketsinLatinAmerica.pdf