Jose Sitjes, Regional Business Development Director MD&D ... · Market entry strategies in APAC Jose Sitjes, Regional Business Development Director MD&D DKSH Healthcare . Zurich,
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69% of the world’s ‘megacities’ (population >10 mln) are in APAC
1Income greater than USD 3,600 per annum; 2Measured as disability-adjusted life years (DALYs) lost to COPD, asthma and lung cancer Source :IHS Economics (2015); World Bank; McKinsey Insights
Growing demand for healthcare in Asia Pacific
Large population
More than 50% of the population, nearly 3.7 billion people, live in APAC
Urbanization Aging society
Baby boom Affordability Morbidity
By 2025, APAC will have 1.1 billion people older than 50 years
Each year 65 million babies are born in APAC
By 2015, more than 50% of APAC, or 2 billion people, will be in the consuming class1
APAC accounts for nearly two-thirds of the global disease burden from major chronic respiratory diseases
Why are we from DKSH in position To talk about market entry strategies? [read] On average We support 30 healthcare companies To enter new markets Every single year
Since we play in the field of distribution and commercial partnership Give you some more background on the business models that are most demanded But I want to highlight that I’m not here to sell or promote them over other strategies 3PL: outsource importation, product storage, order processing and delivery to customers (pharmacies, hospitals) 4PL: … Outsourcing your sales force & contracting a dedicated team of reps through a partner or buying share of voice in an existing shared team. Is one form of commercial partnering that is popular for OTC companies throughout Asia This so called “CSO” model is often combined with a 4PL but it can be a stand-alone Marketing still in-house In a Full Agency or Full Services partnership distribution & commercial services are being outsourced. This arrangement goes a long with a transfer of product owner ship DKSH buys the products at an agreed transfer price And allocate A&P expenditures independently
MNC present in most or all Asian markets with established sales and marketing teams
SME: Small and medium-sized enterprises MNC: Multinational corporations
Your existing Asia footprint matters
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Now that I’ve introduced different entry strategies and partnering models I want to share some insights on which strategy is applied by whom Looking at the existing presence in Asia has proven to be a fruitful differentiator We differentiate between
New to Asia: Lack of local knowledge typically outsource a broad portfolio of services when entering a new market Expanding in Asia: Leverage insights from other Asia markets Setting up an own rep office with regulatory function Outsourcing sales activities in one of the channels (typically: trade channel – dispersed) Established Market entry more often -> launching new brands. Existing resources can be leveraged while outsourcing distribution & collection Due to cost pressures we see more and more companies outsourcing Trade channel sales teams nationwide or rural areas while focusing on key cities & hospital themselves Mature brand outsourcing to focus own resources on new / blockbuster products Optionality: flexibility over time Start as FA, after 3 years change sto
Highlight that you have options … Regardless of which strategy you choose you should consider certain steps when entering a new market Let’s look at some of them now
2 Be aware that regulatory road blocks can have a big impact
3 Base your decisions on real first hand insights
4 Take channel economics into account
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…able to identify the right target customer to drive the initial sell in 4. what drives independent pharmacist recommendation? … pharmacists are business men too. If your product generates a lower margin for the pharmacist than competitor brands … don’t be surprised if they recommend these products instead
Jose Sitjes Regional Business Development Director Medical Device Business Unit Healthcare DKSH Management (Thailand) Limited 16th Floor Fantree 3 Building, 2106 Sukhumvit Road, Bangchak, Phrakhanong, Bangkok 10260, Thailand [email protected] www.dksh.com
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