Company presentation to Max Zeller Söhne AGJanuary 2013
Ebsa pharma – your turnkey solution to the Chinese market
Your participation in a Potential and Ever-Growing Medical & Pharmaceutical Market in China
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Contents
Services, medical and sales network
Key figures of Chinese healthcare sector
Features of pharmaceutical market in China
Successful case of market introduction and sales
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Services to European Pharmaceutical Lab
Drug and Medical device registration with SFDA Planning Dossier preparation
Translation(s) Clinical trial(s)
IDL registration – Import drug license (Class III, IIa, IIb medical device license)
Drug and medical device marketing and distribution in China Product introduction Distribution Terminal sales
Services, medical and sales network
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Organizational Chart
Services, medical and sales network
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Services, medical and sales network
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Services, medical and sales network
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Ebsa pharma’s success is driven by 138 sales representatives and 5 marketing specialists. Our business geographical market area stretches over 14 provinces of which 8 are the most important in relation to current and expected future significant developments.
Ebsa pharma ’s presence in key and sub-prime markets
• Beijing• Guangdong (Dongguan, Guangzhou, Shenzhen)• Henan (Luoyang, Zhengzhou)• Hunan• Jiangsu (Nanjing, Suzhou) • Shandong (Jinan, Qingdao, Yantai)• Shanghai• Zhejiang (Hangzhou, Ningbo)• Fujian (Fuzhou, Xiamen)• Guangxi (Guiloin, Nanning, Liuzhou)• Hubei• Shanxi • Sichuan• Tianjin
Heilongjiang
Jilin
Inner Mongolia
Xinjiang
NingxiaShanxi
Beijing
Hebei
Liaoning
Gansu
Shandongg
Jiangsu
Shanghai
Zhejiang
Fujian
Yunnan
Guizhou
Jiangxi
Anhui
Henan
Hubei
Hainan
Tibet
Qinghai
Taiwan
Shanxi
Sichuan
Guangxi Guangdong
Tianjin
Chongqing
Hunan
Services, medical and sales network
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Total health expenditure in China witnessed steady growth in the past few years
• 1996-2009 (US$ 1 bn)
28
5762
6876
86
96102
110117
125
1995 2000 2001 2002 2003 2004E 2005E 2006E 2007E 2008E 2009E
CAGR=8%
CAGR=11%
CAGR=16%
Source: According to official estimates, figures from China Statistical Yearbook, Espicom Business Intelligence and other institutions are more upbeat; as a whole, Chinese market presented strong growth in the past few years and based on good macroeconomic situation, improving personal ability to pay and enhancing individual’s attention on health, the growth will continue.
Key figures of Chinese healthcare sector
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Estimated by IMS, the pharmaceutical industry will grow significantly over the next 10 years, leading China into the second largest global pharmaceutical market behind USA.
• Pharmaceutical market in China will amount to 800 bn Yuan in 2013; it will amount to 2-3 trillion Yuan in 2020 to rank second in the world.
• Key driving factors: Continuous economic growth and awareness of population’s health consciousness;
Added investment in health care reform favours the growth potential;
Stake of aging population increases.
Source: IMS Health
China’s domestic growth and global market size between 2001-2020.Increase by 17% between 2001-2010 and by 15.5% between 2011-2020
USA
Japan
Germany France
Italy
UK
Spain
Canada Mexico
China
China
Japan
USAUSA
Japan
Germany France
UK
Italy
China
Spain
Canada Turkey
Key figures of Chinese healthcare sector
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95% 92% 87%80%
70%
5% 8% 13%20%
30%
1980-1989 1990-1995 1996-2000 2001-2003 2004-2015
At present, hospitals take the lead in medical sales while retail pharmacies tend to increase their market share in future. However, imported and high priced drugs will continue to be mainly distributed in large-scale hospitals.
Source: URC market survey
Share of retail channel
Share of hospital channel
Changes in market shares of pharmaceutical sales in terminal market
45%
55%
(Forecast)
(Forecast)
The percentage of drug consumption in medical institutions will decline as a result of various factors:
• The policies about the separation of prescribing and dispensing have been gradually carried out.
• The phenomenon of “patients buy medicine in pharmacy with prescription”, namely, policies about separated management of prescription and OTC drug, will realize the separation of drugs in hospital and pharmacy.
• The emerging of medical care designated pharmacy solves the worries of consumers to buy medicine in pharmacy.
• Pharmacy is allowed to diversify operations, so the investment in pharmacies increase to a certain extent.After 2015
Features of pharmaceutical market in China
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Hospitals are the largest terminal clients of medical consumption and remain constant in numbers for the past few years. In addition, hospitals of upper class, witnessed small differences in numbers.
Source: Data from Ministry of Health; Roland Berger analysis
Changes on number of major medical institutions (10,000] Changes on number of hospitals of different classes (10,000)
(During 2005-2009) (During 2008-2009)
Clinic
Health centre
Hospital
其他
一级
二级
三级16.7 16.7 16.8 17.8 17.8
50.3 49.8 48.6 46 45.2
222 237.2 244.3212.9 198.3
2005 2006 2007 2008 2009
977 962
5198 4903
2674 2479
9,4208,299
2008 2009
Grade I
Others
Grade II
Grade III
Features of pharmaceutical market in China
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It is seen from pharmaceutical consumption that the Grade III hospital exceeds the Grade II hospital by four times. However, the hospital quantity of the former is about one fifth of the later, therefore they are similar in pharmaceutical consumption.
60,605
11,929
2,367
Annual pharmaceutical consumption of a hospital in various grades [ten thousand Yuan]
Annual total pharmaceutical consumption of hospital in all grades [hundred million Yuan]
5,830 5,849
2,230
Source: Data from Ministry of Health
Grade III Grade II Inferior to grade II Grade III Grade II Inferior to grade II
Features of pharmaceutical market in China
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Medical markets in China are mainly concentrated in coastal and developed cities.
Source: The data is from commercial delivery condition of a large-scale multinational company. It is reflected hereby that hospitals are unreasonable in sales status. However, it can be judged that it is reasonable to have medical market especially the high-end medical market in developed cities and coastal areas.
11%9%
30%
9%
15%
14%
13%
Beijing
Shanghai
Guangzhou
Hangzhou
Nanjing
Qingdao, Jinan
Others
Features of pharmaceutical market in China
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It takes more than 5 years in Chinese market for a product to become matured from its launch.
Market introduction period
Swift growth period
Market mature period
• 1-2 Years • About 4 years • 5-10 yearsDuration
Market investment
Market share
• Great market investment force
• Channel developing • Medicare public relation
• Take share of opponents • Increase market share • Maintain market share
• Terminal excitation
•Channel gathering
• Deep distribution
• Pay attention to maintenance of customer loyalty index
• Consider introduction of new
drugs 95’ 98’ 00’ 04’94’
1. 44 million
1.5 hundred million
CAGR138%
CAGR58%
CAGR29%
Schematic diagram: life cycle curve of pharmaceuticals
Example: compound danshen dripping pills reaches to mature stage by 9 years.
>8.2 hundred million
Example
Features of pharmaceutical market in China
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Indication: peripheral nerve injury caused by poisoning of normal hexane Product medicament form and specification: 2000 units, powder-injection Product price: 168 Yuan/piece
Product features ： New compound, national category I new drug, biological agent Indication is narrow, therefore it is impossible to form sale scale in indication
popularization Self-paying drug and not entering into NDRL The product is less in curative effect material and low in doctor cognitive degree There is only one enterprise manufacturing like products - Wuhan Hitecin
Pharmaceutical Co., Ltd. with all-round management mode adopted. Product positioning:
The only drug in promoting orientated growth of injured neurocyte
Sale mode: Control terminal specialization popularization mode
Successful case:
Nerve growth factor of rat (NGF – brand 恩经复） ---- CNS
Successful case of market introduction and sales
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Product Research: It is reported in literature that the product can promote orientated growth of neurocyte in
the laboratory The product is large in molecular weight. Although there is laboratory report for the product
in penetrating blood-brain barrier. However, we found out through deep interviewing with doctors that most of them think that the product is difficult in penetrating blood-brain barrier.
It is the initial launching product, therefore there is less clinical data in promoting the product There is only one like product with central nerve restoration of nerve internal medicine as
main function
Product positioning and objective market: The only drug in promoting orientated growth of injured neurocyte Main objective hospitals: Grade A class three large-scale hospital Main departments for product:
Paediatrics Orthopaedics Rehabilitation Department
Main diseases cured by the product Peripheral nerve injury (including peripheral nerve injury caused by trauma and peripheral nerve
injury intercurrent with other disease) Newborn infant brain paralysis (newborn infant blood-brain barrier is not mature and can be
penetrated by macromolecular substance)
Product research and product positioning objective market: marketing starting point is to learn product
Successful case of market introduction and sales
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Product conception spread plan and execution: Establish market budget and decomposition Seek and confirm opinion leader from product spread industry
Seek and confirm nationwide expert lecturers and communicate with them Seek and confirm regional expert lecturers and communicate with them
Confirm product conception spread items and fabricate related lecture material Preparation of slide Preparation of advertisement leaf
Establish market produce conception spread plan and implement the plan Nationwide conference plan: professional meeting plan in sponsoring related institutes; nationwide
tour lecture plan Regional conference plan: annual meeting sponsor plan of related institutes from leading markets;
regional tour lecture plan
Sales representative promotion tool and brand prompt preparation based on product positioning
Sales team product training plan and execution
Marketing Execution：Product conception spread and sales promotion plan of market department based on product research and product strategy
Successful case of market introduction and sales
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Establishing sales plan based on market strategy and execute the plan: Confirmation and decomposition of sale index Confirmation and decomposition of sales budget Establishment and execution of working standard for sales manager/representative Confirm list of objective hospital and hospital development plan and execution Confirm objective doctor standard and objective doctor development plan and execution Working content training of sales representative
Slide lecture training Training of product leaf use Training of face-to-face visiting
Sales promotion plan and execution Establishment and execution of round-table conference and department slide lecture plan Regional conference plan: annual meeting sponsor plan of related institutes from leading markets;
regional tour lecture plan
Establishment and transmission of sale team incentive plan based on marketing strategy
Tracing of sale team action: good result can be obtained only after good plan is performed
Marketing execution:
Product conception spread and sales promotion plan of market department based on product research and product strategy
Successful case of market introduction and sales
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Remark :The product was introduced in 2004 and swift growth was maintained in the consecutive 3 years. It maintains the first market share in four like products launched in 2006.
Sales Curve for Rat Nerve Growth Factor
Unit: piece
12
24
40
70
6065 66
0
10
20
30
40
50
60
70
80
03 04 05 06 07 08 09
Unit: piece
Successful case of market introduction and sales
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Look forward ---- Just do it !
Screen and finalize drug or medical device We do the market potential and forecast We sign registration agreement We sign distribution agreement after getting SFDA approval We enter the market and sell We grow together We succeed together!
Contact: Georges Zhang +86 139 01 63 45 09 [email protected] www.ebsapharma.com
Shanghai sales center: Floor 1, Bldg G, Shanghai Info Park, 1188 WanRong RoadFactory: No. 380 BaLing East Road, Yueyang City, HuNan province
Thank you
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