pharmaceutical industry in brazil - cniadmin.cni.org.br/portal/data/files/00... · pharmaceutical...
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Pharmaceutical Industry Pharmaceutical Industry in Brazilin Brazil
Josimar Henrique da SilvaJosimar Henrique da Silva
ViceVice--President of the Director CouncilPresident of the Director Council
[email protected]@febrafarma.org.br
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Global Global Pharmaceutical MarketPharmaceutical Market(12 months - December 2007 – Retail Sales)
Source: IMS Health - World Drug Purchases
Country Sales 2007 – in Billions of EUR
% of Total Share
North America 161,384 52,86
United States 150,020 49,13
Canada 11,364 3,72
Europe (Top 5) 78,905 25,84
Germany 23,067 7,55
France 21,388 7,00
United Kingdom 12,745 4,17
Italy 11,680 3,83
Spain 10,025 3,28
Japan 42,6999 13,98
Latin America (Top 3) 17,169 5,62
BrazilBrazil 8,8788,878 2,912,91
Mexico 6,332 2,07
Argentina 1,959 0,64
Australia / New Zealand 5,178 1,70
Total 305,335 100,00
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Pharmaceutical Industry Total SalesPharmaceutical Industry Total Sales (Drugstore; Pharmacy Channel) Amounts X units
Source: IMS Health (*)Moving average last 12 months – until May 2008
4,881
4,286
4,745
6,392
7,852
8,878
8,967
1,278
1,219
1,333
1,374
1,437
1,515
1,556
2002
2003
2004
2005
2006
2007
2008*
bbbbffff
EUR (bi)Units
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Cutting taxes down and transferring savings to consumers.Single ICMS tax rate applicable all over the country. Taxation reform.
Flexibility in price control, mainly in most competitive, non discretionary items (non essential to health).Cooperation mechanism between industry and Government to increase the population access to medication.
Optimization of Governmental budget earmarked for medication; partnerships with the private sector.
Definition of clear rules and regulations for the economic-sanitary regulatory framework; compliance with intellectual property and its agile enforcement. Industrial policies.
Access to Medication
Industrial Development
Tax Burden
Regulation of the Economy
The SectorThe Sector’’s Agendas Agenda
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Access to medication
The SectorThe Sector’’s Agendas Agenda
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LowerLower--income social strata with restricted access to medicationincome social strata with restricted access to medication
Source: Target; IBGE; GRUPEMEF; Ministério da Saúde, IMS PMB; análise BCG
13 30 46 61 26
Total MarketEUR per capita per month)
Total Population l (M)Σ
=177M
3,8
12,4
7,7
6,4
4,9
0
2
4
6
8
10
12
14
A B C D E
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Among the reference countries, Brazil is the only one that spends less with medication than its taxation income.
Government Expenditure
Access to medication
The SectorThe Sector’’s Agendas Agenda
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36%
30%
19% 17% 17%
70%
52%
60%62%
65%66%67%
73%75%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Gré
cia
Esp
an
ha
Ale
man
ha
Japão
Fra
nça
(m
édia
)
R. U
nid
o (
média
)
Port
ugal
Hola
nda
Itália
Can
adá
Arg
en
tin
a
EU
A
Méxic
o
Bra
sil
Expenditure with medication(% of total market)
Note: For Germany and Italy it was considered the total taxation income from pharmaceutical sales, including government expenditure. For the remaining countries, it was used the same taxes as in medication. In cases where there are different tariffs (France, for instance: 5.4% for
non-reimbursed drugs and 2.1% for reimbursed ones; UK, 7.5% for non-reimbursed drugs, 0% for reimbursed drugs; and Sweden: 25% for non-reimbursed drugs and 0% for reimbursed ones, it was used an average of the tax amounts.
Brazil is the only country that spends less with medication than its taxation income from medication
4% 3%0% 0% 0%
16%
5%5%6%6%8%
15%
21%
35%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Bra
sil
Arg
en
tin
a
Ale
man
ha
Itália
Gré
cia
R. U
nid
o (
média
)
Hola
nda
Japão
Port
ugal
Esp
an
ha
Fra
nça
(m
édia
)
EU
A
Méxic
o
Can
adá
Income from taxation on medication
Source: OCDE Health, BCG Knowledge Group, BCG Analysis
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Brazil has the highest tax burden among reference countries.
Tax Burden
The SectorThe Sector’’s Agendas Agenda
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Taxes levied on medication in BrazilTaxes levied on medication in Brazil are far beyond other reference countriesare far beyond other reference countries
0,0
25,0 25,0
18,012,0
1,5
12,0
0%
5%
10%
15%
20%
25%
30%
Gasol
ine
Alcoh
olic B
ever
ages
Drugs
Cars
Food
Diam
onds
Veter
inar
y Dru
gs
Fuel
Liquor and Spirits
Drugs
Cars Diamonds
Foodstuff
8.4(1)
Veterinary medication
ICMS Tax on some products in the state of São Paulo
0%
5%
10%
15%
20%
25%
30%
35%
40%
Rein
o U
nid
oC
an
adá
Colô
mbia
Su
éci
aEU
AM
éxic
oV
en
ezu
ela
Fra
nça
Su
íça
Esp
an
ha
Port
ugal
Japão
Bélg
ica
Hola
nda
Gré
cia
Fin
lân
dia
Tu
rqu
iaIt
ália
Ale
man
ha
Ch
ile
Au
stri
aA
rgen
tin
aB
razi
l
Taxes on medication in some countries(Average tax burden for Brazil)
Average without Brazil
= 6.1%
Brazil = 35%
Three possible alternatives:
•ICMS exemption with transfer to consumers
•Single ICMS tax rate throughout the country
•Tax collection at the beginning of the chain
(1) Average
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Note: Medication: Effexor, Prozac, Zoloft, Generic Fluoxetin, Lexotan, Rivotril,Celebra, Vioxx, Voltaren, Amoxicillin, Viagra, Cialis, Lipitor, AdalateNorvasc; prices as per exchange rate
in June 2004
Manufacturer’s price Retail prices
USA / Brazil =4.8x
USA / Brazil =2.8x
USA
MexicoCanada
Italy
PortugalAustralia
FranceNew
ZealandSpain
GreeceArgentina
Class.Class. Class.Class.11 22 33 44 55 66 77 88 99 1010 1111 1212 11 22 33 44 55 1111 77 99 88 1212 1010 66
USA
MexicoCanada
Italy
PortugalAustralia
FranceNew
ZealandSpain
GreeceArgentina
Brazil
Brazil manufactures medication at lowBrazil manufactures medication at low--cost, by cost, by this efficiency this efficiency
is not transferred to consumersis not transferred to consumers
Fonte: IMS PMB; Talogdata; Interfarma; Anvisa; MoH; PMPRB; Rmianz; SFEE; análise BCG
Brazil
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Research-related regulatory issues: Conep, Inpi, Anvisa.
Definition of price readjustment.
Rules for launching new products.
Medication registration: Uniformity of criteria, terms and tax rates.
Patent analysis and awarding: Anvisa’s agreement, terms and data protection.
Transfer prices: Alignment with international rules (OECD).
Regulatory Framework
Definition of clear rules and regulations for the economic- sanitary regulatory framework; compliance with intellectual property and its agile enforcement. Industrial policies.
Industrial Development
The SectorThe Sector’’s Agendas Agenda
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Doctoral Papers Presented
10 Largest Universities10 Largest Universities(Per number of PhDs)(Per number of PhDs)
Adapted from Brito Cruz, 2005
1. Universidade de São Paulo - USP 2,180
2. Universidade da Califórnia, Berkeley 767
3. Universidade de Campinas – UNICAMP 747
4. Universidade New Southeastern 675
5. Universidade do Texas, Austin 674
6. Universidade do Estado de São Paulo - UNESP 663
7. Universidade do Wisconsin, Madison 653
8. Universidade Federal do Rio de Janeiro - UFRJ 643
9. Universidade do Illinois, Urbana Campus 618
10. Universidade de Michigan 615
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0%
2%
4%
6%
8%
Brazil USA UK Germany France Italy Israel Korea Japan
% m
undi
al d
e A
rtigo
s e
Pat
ente
s
% Papers
% Patents
pap
Scientific Papers and PatentsScientific Papers and Patents
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94.333
29.086
51.527
90.635
5.92413.913
0
20.000
40.000
60.000
80.000
100.000
Brazil (2000) Korea (2000)
Scie
ntis
ts a
nd E
ngin
eers
Companies Universities Institutes
Source: Br 1996: Anpei, INEP; Br 2000: MCT, Inep; Korea: http://www.most.go.kr/
Brazil and Korea: Brazil and Korea: Scientists and EngineersScientists and Engineers
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• 20 big and medium sized companies produce phytotherapic medicines (Under ANVISA
standards edict - RDC 48 and attachments);• Gross sales US$ 550 mi;• Estimated US$ 1 bi in 2010.
Research in Phytotherapy Research in Phytotherapy
Amazon:20% of all sweet water in the planet35% of vegetables superior species
There are 220 thousand new living organisms already catalogued in the country.
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Why do we have such good scientific Why do we have such good scientific production and so few production and so few
patents/products ?patents/products ?
Lack of investments
Gap between University and Industry
Lack of articulated structure
Lack of political decision-making
Lack of legal assurance
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Definition of clear rules and regulations for the economic-sanitary regulatory framework; compliance with intellectual property and its agile enforcement. Industrial policies.
Industrial Development
The SectorThe Sector’’s Agendas Agenda
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Price Control is not the ideal mechanism to discipline the market and control disbursements.
It is inefficient to expand access.
Other government initiatives have proven ineffective to expand access.
Flexibility in price control, mainly in most competitive, non discretionary items (non essential to health).Cooperation mechanism between industry and Government to increase the population access to medication.
Regulation of the Economy
The SectorThe Sector’’s Agendas Agenda
Price Access and Control Initiatives
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Cutting taxes down and transferring savings to consumers.Single ICMS tax rate applicable all over the country. Taxation reform.
Flexibility in price control, mainly in most competitive, non discretionary items (non essential to health).Cooperation mechanism between industry and Government to increase the population access to medication.
Optimization of Government budget earmarked for medication; partnerships with the private sector.
Definition of clear rules and regulations for the economic-sanitary regulatory framework; compliance with intellectual property and its agile enforcement. Industrial policies.
Government expenditure
Regulatory framework
Tax Burden
Price Access and Control Initiatives
Topic:Topic: Main ChallengesMain Challenges::
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JosimarJosimar Henrique da SilvaHenrique da Silva
ViceVice--President of the Director CouncilPresident of the Director Council
[email protected]@febrafarma.org.brAugust 2008August 2008
www.febrafarma.org.brwww.febrafarma.org.br