Do emerging markets provide the answer to the pharmaceutical industry?

The emerging markets represent an attractive investment opportunity for the pharmaceutical industry because of the countries' growing economies and unmet medical needs. Western pharmaceutical companies must, however, adapt their approach to R&D and commercialisation if they are to succeed in these rapidly expanding markets.
May 01, 2010

The pharmaceutical landscape is changing. For the last four decades the pharmaceutical industry has focused its attentions on servicing the needs of the western and developed markets with very little attention paid to what used to be referred to as 'the international markets'. However, with advances in science, medicine and technology, many new 'pharmerging' markets are being created with rapid phases of growth and expansion. For example, the emerging markets of Brazil, Russia, India, Turkey, Mexico, South Korea and China will soon account for around 50% of the global pharmaceutical growth by end of 2010.1

The importance of the emerging markets becomes apparent when one considers that diseases that were once prominent in the West and scarce in the East are now becoming prevalent in countries such as China as their economies grow and their citizens adopt western lifestyles.

This article discusses the importance of developing medicinal products for the emerging markets and the various factors that need to be considered, using China as the primary example.

Serving unmet and growing medical need: a focus on China

Epidemiological studies1 conducted in China have shown the following diseases to be widespread: HIV, hepatitis, cardiovascular and cancers. Figure 1 shows how China is catching up with the US with respect to the main causes of death from illness and disease.


The United Nations investigated the prevalence of AIDS in China in 20081 and found that 700 000 people were living with HIV, with 75 000 of these cases having developed into full-blown AIDS. The Chinese Government is therefore naturally concerned by the threat of HIV to the rest of the population.


There are two forms of hepatitis (inflammatory liver disease) — B and C. It has been estimated that there are 170 million people infected with hepatitis B in China. This patient population is poorly served; a mere 4% of sufferers receive treatment and, as a result, 300 000 people in China die each year from the disease.

Hepatitis C, which is a more virulent form of the virus, currently affects 46 million people in China. This number dwarfs the incidence of the disease in the US, UK, Spain, Japan, Germany and France combined.

Diabetes and cardiovascular disease

According to a study by Arnold and co-workers,1 there are approximately 40 million diabetics in China with around 1.5 million new cases reported each year. Studies show that the prevalence of diabetes is stratified across China as follows: 2% in rural towns, 4% in small cities, and 6% in large cities (Beijing and Shanghai account for up to 10% of this figure).


China has a high incidence of lung, mouth and neck cancers predominantly influenced by the high levels of smoking in the country. The WHO estimates that cancer is one of the main causes of death in China with an incidence level of 13% and this is projected to rise to 24% by 2030.1