US pharmaceutical giant Pfizer Inc may tie up with one or more generic drug makers in Japan as it targets demand in the growing market, which it plans to enter after 2010, an executive at its Japan unit said.
Hiroshi Matsumori, corporate officer at Pfizer Japan, told Reuters in an interview that Pfizer would capitalize on its brand name and business expertise in Japan to compete with rivals such as Israel's Teva Pharmaceutical Industries.
Japan's government is promoting greater use of generic drugs to help lower spending on healthcare as the population ages, prompting firms like Pfizer and Teva, the world's No.1 generic drug maker, to enter a market seen growing to around $5 billion next year.
Teva started marketing its drugs in Japan last month, targeting a 10% share of the Japanese market by 2015, while Pfizer will enter the market as early as next year as part of its global move to help offset a series of patent expirations on its key drugs.
“The biggest challenge for foreign players starting business in Japan, where standards are exceptionally high, is branding, which we have already achieved as a patent drug maker. We are completely different from those starting from scratch,” Matsumori said.
“Our goal is not a top market share. However, I believe our aim to take leadership in promoting old, yet good drugs would make us the leader in sales as a result,” Matsumori said, referring to generic drugs as well as drugs that have seen patent expirations.
He said he sees Pfizer grabbing a market share of slightly less than 10% by around 2020 when he expects use of generic drugs in Japan to reach levels seen in the United States and Europe.
“I think Teva's target (for a 10% share) is not crazy but may be a little stretched,” he added.
Unlike Teva, which is using a joint venture with Japanese drugmaker Kowa Co to enter the market, Pfizer prefers to form an alliance without a joint venture, Matsumori said, adding that he has met with four or five partner candidates.
Japan's government aims for generic drugs to make up 30% of the drug market by sales volume in the year to March 2013, up from about 17% in the year ended in March 2009.
Japanese thinktank Fuji Keizai forecasts that the sales of generic drugs in Japan will increase to ¥448 billion ($4.98 billion) next year from an estimated ¥392 billion last year.
Teva has projected that the market's size will reach ¥1 trillion by 2015. (Reuters)