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Healthcare reform makes Rx waves overseas in China

BY Alaric DeArment

NEW YORK —As the healthcare-reform debate threatens to crowd out other political issues in the United States, China is pursuing a healthcare-reform program of its own, and at least one U.S. company sees yuan signs.

Headquartered in New York, retail pharmacy chain BioPharm Asia lately has expanded aggressively in China, planning to open more than 500 new stores in the country over the next couple of months, most of them in rural areas in the country’s northeast, south and southwest.

As one might expect, the retail pharmacy business in China differs markedly from its American counterpart. In China, retail pharmacies get most of their business from OTC products and traditional Chinese herbal medicine, while patients must go to hospitals to fill prescriptions, not to mention personal care products and sundries are few. But the government wants to reform that policy and allow pharmacies to dispense prescriptions as well, a change expected to take place over the next three years. Meanwhile, retail pharmacies have multiplied throughout the country.

“The push in pharmacy is a direct result of the government’s reform in its policy toward insuring its large, aging population,” BioPharm Asia managing director Ethan Chuang told Drug Store News. “It is a natural extension of the country’s trend towards capitalism.”

Chuang said the Chinese government’s push for healthcare reform, including plans to cover healthcare and drug costs for 90% of the population, will give the company, and the market as a whole, room to grow.

“Because the market capacity will be increased following the China New Medical Reform Scheme, the U.S.-based suppliers will [benefit] from this new policy,” Chuang said. “The OTC products would be selling well as more and more drugs will be selling through [the] retailing channel instead of hospitals.”

One chain appears to have foreseen changes in the industry a long time ago.

Based in Shenzhen—the city across the border from Hong Kong that was the launch pad for capitalism in mainland China—Nepstar now operates 2,312 stores, having started as one store in 1995. Last year, Nepstar expanded rapidly by acquiring smaller regional chains, such as the 42-store Kangjie Chain Drugstore Co. in the northern city of Qingdao, for $2.5 million; the 18-store Hui Ren Tang Pharmaceutical Co. chain in the southern city of Dongguan, for $300,000; and the New Century Medical’s 68 stores in the eastern city of Ningbo, for $4.1 million.

Nepstar has made hay by offering customer services vaguely reminiscent of those found at U.S. retail pharmacies. The Loyal Nepstar Customer Scheme, launched in 1999, now has 11 million members whose purchase and health information are entered into a database, allowing discounts and the accumulation of points they can exchange for gifts. Last year, the company partnered with China Merchants Bank and Lakala Beijing Billing Service Co. to install electronic payment kiosks, allowing customers to pay their credit card, mobile phone and utility bills.

Chuang estimated that 300,000 retail pharmacies exist in China, though the market remains largely fragmented compared with the brand-heavy U.S. market. BioPharm Asia hopes to open 5,000 stores around the country and become a leader in an industry that eventually could look more like the one here, dominated by a handful of key players.

“The trend…is toward brand recognition, and more diversified and larger pharmacies,” Chuang said.

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Late-stage clinical trial results: MS drug is effective

BY Alaric DeArment

ALISO VIEJO, Calif. Patients taking an investigational drug for multiple sclerosis fared better than those taking placebo, according to late-stage clinical results presented Friday at a neurology conference.

Avanir Pharmaceuticals said MS patients taking Zenvia (dextromethorphan and quinidine) in 30 mg/10 mg doses experienced a 11.9% greater reduction in pseudobulbar effect – an MS-related condition also known as PBA that causes sudden, uncontrollable episodes of laughter, crying and other emotional outbursts – than those taking placebo in a 12-week phase 3 trial, results of which the company presented at the 3rd World Congress on Controversies in Neurology in Prague, Czech Republic. Patients taking the 20 mg/10 mg dose did not do better than the placebo group.

“PBA represents an area of high, unmet medical need with no FDA-approved treatments currently available,” study presenter and trial steering committee member Daniel Wynn of the Consultants in Neurology Multiple Sclerosis Center stated. “Although the involuntary emotional outbursts of PBA cause considerable impairment for millions of individuals in the United States, it is under-recognized and commonly misdiagnosed.”

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New report projects 12.6% increase of probiotics market

BY DSN STAFF

NEW YORK The two takeaways from this story are “the [U.S.] market is expected to grow at a rate of almost 14%” and “the early movers in the industry will benefit in terms of market share.”

 

That about describes the opportunity in a probiotic nutshell.

 

 

The rising interest in probiotics can be credited in part to Dannon’s Activia brand, a line of yogurts and yogurt drinks, which has been heavily advertised to the American consumer with the message that not all bacteria is bad for you — and in fact some bacteria taken on a regular basis can impart some pretty significant health benefits. That advertising message — that probiotics can be an important piece in a healthier-for-you diet — has been all the more reinforced as Bayer supports its probiotic Phillips Colon Health, and as Procter & Gamble rolls out its Align probiotic.

 

 

And the consumers already are core drug store shoppers. The ratio of women to men in search of a product delivering digestive benefits is about 2-to-1, according to industry experts. When women hit their 30s and 40s, that’s the point in their lives when they’re looking for a strategy in life to help them manage their digestive issues.

 

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