Nutrition and Mental Health This article first appeared in Brainwaves Magazine, Winter 2007, author not accredited. Mental ill health is believed to be the result of a combination of several factors, including age, genetics and environment. For decades the prevalent treatments for mental health problems have been medication and psychotherapy. It is now emerging that one of the most obvi
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Focus080912.inddVol. 19, No. 17 International Federation of Pharmaceutical Wholesalers August 23, 2012
Pharma’s Dilemma Within The Eurozone
(Source: Edited excerpts from an article written by Katrina Megget, edited by Claire Bowie and Jenny Hone and published in the Pharma’s dilemma with respect to the Eurozone market is Spain and Portugal: Germany and the UK are also being subjected two-fold: a rising receivable and signifi cant price cuts. As Greece’s fi nancial crisis escalated and the possibility of the country exiting Targeting the drugs bill and slashing medicine prices is from the Eurozone, the true extent of the Pharma crisis became known becoming a short-term fi x for many governments and is causing – as of 31 December 2011, the four southern European countries - concern within the industry. In Greece, for example, drug prices consisting of Portugal, Spain, Italy and Greece - collectively owed were cut by an average of 30% in 2010 and then slashed a further Pharma companies more than €12.5 billion/US$15.7 billion.
27% a year later, while fi gures sourced from EFPIA show falling Spain alone owes more than €6.3 billion/US$7.9 billion, and drug prices have already cost drugmakers more than US$2.67 while drastic cuts to drug prices have been implemented to curb the billion in lost revenue. This downward spiral becomes problem- growing debt - in some cases as much as 30% on average - there are atic because Greece is used as a reference pricing country in as increasing delays in getting payment to the industry. Meanwhile, many as 15 other European Union member states. The concern fi gures from Business Monitor International show that drug sales is that if the price drops signifi cantly in Greece then the prices of to pharmacies and hospitals in 2011 fell 2 .2% in France, 3.1% in drugs in the rest of Europe will plummet, threatening pharma’s Italy and almost 9% in Spain. The industry in general is not only sustainability even further. Michael Thomas, partner in AT Ke- confronting the patent cliff but it also has to address market access arney’s pharmaceutical practice, says the impact on prices across barriers, a dwindling product pipeline, diminishing capital to fund Europe could be “profound”. “We estimate that price reductions research and development, pricing pressures and an ever increasing imposed in Greece in 2010 could ultimately lead to an 18% price decline in markets that directly or indirectly reference the Greek The key question for Pharma is how to respond to these forces. market, like Austria, Slovakia and Turkey.” For Roche announced it would stop delivering to some state-funded Additionally, many countries are also favoring the in- hospitals in Greece on the back of unpaid bills. The move didn’t creased use of generics to cut healthcare costs. Greece, for place the fi rm in a favorable light, but in an interview with the Wall instance, has pushed through plans to make generic prescribing Street Journal, company’s chief executive, explained: “There comes mandatory, Spain is requiring prescribing by active ingredient a point where the business is not sustainable anymore.” According to while generic prices there have been cut by 25% and, in Germany, company fi gures, as of December 2011 public customers in Southern branded drug prices are being linked to those of generics.
Europe have still to pay some 2.1 billion Swiss francs/US$2.2 bil- Despite Spain recently announcing a €17 billion/US$21 lion, which represented 21% of the amount the Swiss company is billion bailout – of which 73% will cover unpaid healthcare bills owed worldwide. Since its decision in Greece, Roche has tightened - the situation across Europe is still dire. As a result, “Pharma its credit in Spain and Portugal, where selected hospitals are required companies will be looking carefully at their product and market to payoff some of the outstanding debt before receiving more sup- strategies”, notes Chris Stirling, European head of pharmaceu- plies from the drugmaker. The company is “carefully evaluating the ticals at KPMG. In some cases, he says, there may be “a greater situation in Southern European countries” including discussions with level of volatility in product withdrawals” or companies will look relevant hospitals in each country” to fi nd mutually acceptable solu- to invest their products and existing capacity in new markets. tions with regard to outstanding debts and to ensure the continued Thomas says it is unlikely companies will entirely pull out from fl ow of medicines to hospitals and patients”, a company spokesperson told PhamaTimes Magazine. She stresses that “patient access to our medicines remains our primary concern.” Dean Summerfi eld, managing director of Quintiles Consult- ing in Europe, commented: “Ultimately pharmaceutical companies rely on revenue to continue operating, just like any other industry.” However, he warns, with the Eurozone crisis as it is and Pharma IFPW 2012 General Membership Meeting
companies on high alert, “the impact on patients is potentially dam- DELEGATE REMINDER
aging”. Media reports in May said around 163 essential medicines Ground Transportation, Accompanying Persons and Optional are unavailable from pharmacies in Greece, while some pharmacies Activities reservations must be made through the congress that are not being reimbursed by the government are refusing to supply medicines unless patients pay upfront. Governments across Please visit
Europe are attempting to address their defi cits and in the healthcare www.dmc-cancun.com/ifpw
system this involves draconian actions. However, the measures are not confi ned to those countries most at risk - notably Greece, Italy, to reserve now!
Copyright 2012 - International Federation of Pharmaceutical Wholesalers, Inc. All Rights Reserved. Number of Pages: 2
August 23, 2012
Eurozone. . .(cont.)
clinical studies. Bilcare Limited will retain its clinical supplies markets. “But we do see a scenario where companies may consider it business in Asia but has agreed to work together with United Drug no longer viable to supply specifi c products and, more importantly, in cases where customers require clinical-trial materials services will seek payment on delivery where there is history or risk of non- across the US, UK and Asia. United Drug’s international opera- tions, with the businesses outside of Ireland, now contribute over “As governments face increasing expenditure pressure, we 70% of group profi ts.
can expect approval timelines for new products to extend and higher Toho Holdings, a leading Japanese wholesaler and health-
thresholds to be placed on innovation and value,” says Thomas. “This care service provider, reported a 4.5% increase in net sales to will obviously affect the sequencing of launches across Europe.” US$3.5 billion and net income of US$30.7 million (+24%) for its Further to this will be the impact on Pharma innovation in the long- term, which Summerfi eld says is already being seen. “The current Celesio, a leading international trading company and pro-
situation, where the market cannot afford to fund access to existing vider of logistics and services in the pharmaceutical and health-drugs that are known to benefi t patient populations is itself a barrier to care sector, reported revenue of €11.25 billion / US$14.1 billion innovation.” Ironically, the need to demonstrate value and outcomes (+1.8%) and net profi t of €29.6 million / US$37.2 million (-20.1%) in clinical trial data to ensure future access will be hindered by the for the fi rst half of 2012. The Company communicated that its fact there is no revenue to fund those clinical trials. But innovation wholesale and retail activities in the Czech Republic will be sold will be further reduced as governments increasingly divert funding for a combined purchase price of €84.5 million / US$106.2 mil-away from research in order to maintain access to existing drugs, lion; following earlier divestments of Movianto and Pharmexx, the he says. “A key area that will be affected is personalized medicine planned sale of DocMorris and the possible sale of the wholesale - investment in drugs that can benefi t specifi c patient populations is business in Ireland.
likely to be reduced as budgets are tightened.” IMS Health has acquired TTC, a Philadelphia-based bench-
However, Stirling believes that after an initial slowdown in marking solutions and analytics company that helps life sciences R&D, new commitments with protected budgets will emerge and organizations around the world plan for and negotiate the costs of innovation will increase as more cost-effective solutions are required clinical trials. TTC offers clients clinical trial cost benchmarks, by all markets. For many countries in the Eurozone there is a quiet budgeting and negotiation tools to enhance the speed, effi ciency reliance on the Pharma industry to aid economic growth. But with and cost-effectiveness of trial planning and management activities, Pharma reaching breaking point its role in economic growth will also for an undisclosed sum. The move follows IMS’ April acquisition be questioned. “There are no prospects of increased funding in the of DecisionView, a technology innovator that delivers clinical trial short-term,” Stirling notes. “Over time each health system will have planning and performance solutions. to fi nd the best way to maximize the value of the available public Galenica Group (Switzerland) reported net sales of US$1.7
purse spend.” While cutting drug prices is being seen as a quick billion (+2.2%) and net profit, before minority interests, of fi x the industry, understandably, he believes this is not a long-term US$136.9 million (+6.8%) for the fi rst half of 2012.
solution. Likewise, some companies have expressed an interest in To help mitigate against possible disruption to the medicine receiving government bonds in return for unpaid debts, but Richard supply chain during the Olympic and Paralympic Games, the Brit-
Bergstrom, director general of the European Federation of Pharma-
ish Association of Pharmaceutical Wholesalers (BAPW) worked
ceutical Industries and Associations (EFPIA), says “solving the past with Department of Health, NHS London, Transport for London situation through government bonds 01’ and other fi nancial tools is and all 1,500 pharmacies and hospitals likely to be impacted - to not suffi cient if nothing is done to ensure this scenario is not repeated prepare and agree to a specialized temporary delivery service.
in the near future”.
Prescription drug sales at Japan's 10 largest domestic phar- The solution most often cited for this complex dilemma is col- maceuticals companies are forecast to grow from US$76.8 billion laboration. Says Summerfi eld: “Unilateral actions from either side, in 2011 to US$81.2 billion in 2017 as these fi rms are increasing or a breakdown of trust through non-payment or withdrawal of sup- globalization, in-licensing and their focus on oncology, according ply, will quickly and directly negatively impact the most important to Datamonitor.
stakeholder - the patient. Solutions to improve healthcare in times Retail pharmacy chain Walgreens is deploying Greenway
of austerity need to be brokered through more active collaboration Medical Technologies’ electronic health record solution to more
between all stakeholders and more open dialogue between healthcare closely integrate its healthcare services. The EHR is currently
payers and the industry.” Bergstrom believes there are a number of in more than 200 Walgreens stores, with chain-wide rollout to
workable solutions and says EFPIA is committed to implementing its nearly 8,000 locations planned to be completed by the end of
them, “but we cannot do it without others such as member states summer 2013.
and the European Commission”. Joining forces to solve Europe’s
Pfi zer has entered an agreement for global over-the-counter
healthcare woes might take some time but in the long run working (OTC) rights to Nexium, AstraZeneca's blockbuster proton pump
inhibitor (PPI) for heartburn and related conditions for US$250 mil- lion (plus milestone and royalty payments). The patents covering Ireland-based wholesaler and healthcare service provider United the prescription form of Nexium will begin to expire in 2014. AZN
Drug is acquiring Bilcare’s Global Clinical Supplies (GCS) opera- already markets an OTC form of the older PPI Losec/Prilosec, as
tions in the UK and the US for US$61 million. Bilcare GCS, owned do a number of generic manufacturers.
by India’s Bilcare Limited, provides clinical-trial materials services to pharmaceutical/biotechnology companies and clinical research (Sources: BAPW, Celesio, Drug Store News, Galenica, IMS, organizations worldwide - including the formulation, development, Pharma Times, Scrip, Toho Pharmaceutical and United Drug) packaging, labeling and supply-chain management of drugs used in
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