At first blush, a system whereby countries or geographic areas are carved out along socioeconomic lines maximizes profit: prices are set according to consumers’ “willingness or ability to pay,” which can bring previously unaffordable treatments into use. However, a tiered price can work against local competition in a given area, which tends to deliver a lower sustainable price over the long term, according to a critical analysis of tiered pricing done by authors from Medecins Sans Frontieres and Harvard School of Public Health.

Of the case studies examined in the report, Abbott’s price for the HIV treatment lopinavir and ritonavir (LPV/r) remained at $500 in African countries and other “least developed countries” from 2002 to 2007, or until the Clinton HIV/AIDS Initiative announced a generic LPV/r for $470. Abbott then reduced its price to $440, suggesting that manufacturers “do not have strong incentives to reduce tiered prices in the absence of competition, nor are tiered prices immune to competition when it does arise,” according to the report.

In the case of Bristol-Myers Squibb’s antiretroviral (ARV) treatment for HIV, the company created a Category 1 tier including 57 primarily low-income and African countries, but excluding southern African countries, which were lumped into a higher income Category 2. Southern Africa has the highest HIV-prevalence rates in the world, and the impact of a Category 2 placement means that BMS “prices its important second-line drug atazanavir 25% higher, at $547, in southern Africa, compared with $412 in other [Category 1] countries where HIV prevalence is lower, and in a few cases, income is higher,” the report found.

In the case of Lilly’s drug-resistant TB products capreomycin and cycloserine, however, tiered pricing did work to create lower prices than competitive production, but there were special circumstances. For example, TB endemic countries participating in the “preferential price” scheme facilitated by the WHO Green Light Committee beginning in 2002 – a program that also transferred technology to local generics manufacturers in support of local production – did not see a cheaper generic reach the market. In the case of capreomycin, no generic products were WHO pre-qualified for use as of September 2011, and cycloserine had gone up in price by a multiple of four, after Lilly stopped producing the drug. Lilly’s tiered pricing did in fact keep prices at the lowest rates, although demand was low and production capacity was limited.

“Tiered pricing does not necessarily result in the lowest sustainable prices, nor does it reliably lead to price reductions over time,” the report’s authors conclude. “In comparison, when markets are sufficiently large and multiple sources of production exist, robust competition has consistently proven across different therapeutic areas to result in lower prices.” Tiered pricing also leaves “too little decision-making power to governments, which are accountable to their populations under international law for insuring access to medicines.”

Countries that aren’t strong negotiators, and can’t convincingly threaten compulsory licensing, for example, get the short end of the stick with tiered pricing. In 2006, Honduras purchased LPV/r for about six times more than Brazil paid, despite the fact that HIV rates are equivalent in both countries, and Honduras per capita gross national income is roughly 25% of Brazil’s. To create a truly “win-win” situation for manufacturers and patients, governments and manufacturers will need to consider new models that “de-link” medicine prices from R&D costs. How countries contribute to R&D financing as a global public good will influence the new models that help to bring new medicines to the most needy.

Thirty years is a long time in any industry. The coalmining industry, the market for air travel, or telecommunications and computing technologies each offer compelling demonstrations of how much can change in such a short period. Few market leaders in those sectors have survived.

Against that background, the pharmaceutical industry has done pretty well over the last thirty years — and so have many of its players. Eli Lilly, Pfizer, Boehringer Ingelheim, Hoffman-La Roche, Merck Sharpe and Dohme — all were big beasts, and they still are. The industry was one of the darlings of the investment community back then, and still today it is seen as one of the safer counter-cyclical havens. And the industry’s enduring qualities as a powerhouse of scientific advance and a generator of high-quality jobs and exports continue to assure drug firms of sympathetic ears in many of the corridors of power.

Survival has, however, been very much the prize of the fittest. In a world grown harshly competitive, many firms have fallen by the wayside, been trampled underfoot, or have simply been lost without trace. Three decades of successive concentrations have thinned the ranks of the industry to a mere shadow of its former self. The roll-call of once-illustrious names has been abbreviated by bankruptcy, mergers and acquisitions. Who now recalls Richardson, which merged with Merrell before being taken over by Dow? There are many working in the industry today who are unaware that a proudly independent Beecham – with its breakthrough work on antibiotics – merged with SmithKline and French before its name was obliterated altogher from the marquee when Glaxo took over the entire operation. The French industry was dominated by Rhône Poulenc and Rousel Uclaf when Sanofi was still a struggling adolescent.

The relentless search for efficiencies, for leaner management, for shareholder value, and for  market share has hit the pharma sector hard. Gone are many of the notorious extravagances of the past. Product launches on the Orient Express or on yachts in the Mediterranean attracted hostility and accusations of a greater focus on marketing than on research. Armies of highly organised sales forces provoked questions among the sceptical about how much success had come to depend on science, and how much on subversion. The rise of a new and assertive form of consumer activism in the 1980s found ample fuel here, and prompted deeper soul-searching among the organisations that were paying for medicines — the consequences of which are still being played out today.

Major advances in diagnosis and treatment (AIDS was an ill-understood but fatal condition in the 1980s) tend to obscure the fact that it is some thirty years since the first blockbuster medicines emerged. Huge optimism was created by the revenues from innovations like cimetidine and ranitidine. But the resulting search for world-beating products not only led to some revolutionary earnings by revolutionary products. It also imposed new economic strains that took their toll of the sector. For many, the development costs and high risk were more than they could comfortably sustain.

In parallel, the operating context was changing rapidly. High-profile cases of big new products with big adverse effects led to some conspicuous withdrawals from the market — and to constantly-rising requirements from regulators who had burnt their fingers through injudicious authorisations. Extensive demands for greater preclinical and clinical testing tightened the screws still further on the industry’s business model, just as the opportunities opened up by biotechnology applications were also making research more expensive and unpredictable. And alongside the strains on innovation, challenges multiplied in the marketplace, from increasingly adventurous generic producers, and the still-sharper elbows of the burgeoning parallel trade sector.

The spectacular increase in international products and international marketing exposed as never before the fundamental weakness confronting the industry in Europe: the divergent national requirements, which split a potentially large market into a patchwork of distinct fragments and hindered the continent-wide launch of innovations. This was the background to the development, throughout the 1980s, of the first attempts at a pan-European system of obtaining marketing authorisations. It was, at times, a painful experience, handicapped (and occasionally even sabotaged) by resistance from national authorities to what they saw as an erosion of their prerogatives, and boycotted by some major firms fearful of concentration of power at European level.

The deficiencies of those initial procedures led to the construction of the more robust mechanisms of the European Medicines Agency. This has, over the fifteen or so years of its existence, brought a new degree of harmonization to product authorization — and extended its authority to a wide range of related issues that have arisen, from advanced therapies to the promotion of smaller biopharm companies.

Over the same period, the industry in Europe managed to persuade the European Union to take action to compensate firms for the growing delays in bringing new products through the ever-lengthening development periods. Patent term restoration legislation and subsequently data protection rules provided some relief for innovators against the depredations of generic competitors.

But if the industry had some success in winning arguments about the merits of innovation, it was conspicuously less successful in convincing national or European authorities to put their money where their mouth was. Attempts by brandname companies to contain the rampant growth in parallel trade  failed repeatedly — and on more than one occasion, spectacularly. European court rulings consistently upheld the EU doctrine of free movement of goods within the EU, and when one European Commissioner acceded to industry urgings to raise the question of overturning this sacrosanct principle, he was left high and dry because industry failed to deliver on its promise to provide him with the supporting evidence. It took years for the industry’s credibility to recover.

More significantly, European countries, even within the EU, retained absolute sovereignty in their decisions on pricing and reimbursement. So the best that the industry was able to obtain was an EU directive requiring national authorities to operate in a transparent fashion about their reasoning for decisions – but the decisions nonetheless remained entirely autonomous, and increasingly parsimonious, so industry gained little or nothing.

This divergence in economic decision-making continues to bedevil the operating climate for the industry — and all the more so as the winds of economic crisis whistle more threateningly. The assumptions that had prevailed for so long, that healthcare spending should continue to rise, are now subject to open challenge. The pressures on drug budgets — which have in any case been an easy target in healthcare financing over recent years — are inevitably increasing as a consequence.

The industry in Europe has been engaged for more than two decades in a protracted  lobster quadrille of round tables, forums and high-level groups with politicians, payers and patients, ostensibly to build a European policy for pharmaceuticals that can guarantee access to medicines while promoting research. But the overall effect has been to blunten rather than sharpen industry arguments for better treatment in terms of market access and adequate pricing and reimbursement.

The recent emphasis on ensuring the sustainability of healthcare systems — a constant theme now in European political debate — is not helpful to industry’s renewed bid for recognition of the importance of innovation.  There is plenty of talk on all sides about the need to promote innovation — in Europe this type of rhetoric has attained epidemic proportions — but the talk is yet to produce any real shift in attitude among healthcare payers. The debates are complicated by new uncertainties over the prospects and perils from advances in areas such as personalised medicine or e-health, or the challenges of providing care for increasing numbers of old people. But it will be unwise of Europe to spend another thirty years looking for solutions. The game has been changed out of all recognition, and the schedule dramatically abbreviated, by the rise of the new economies. No longer will the debate focus on the decline in Europe’s performance compared to the US and Japan. Now the industry lives under the shadow of China and India’s might — and they will not stand patiently aside while Europe reflects on how to maintain industrial competitiveness.

Reflector is Pharmaceutical Executive’s EU correspondent.

The path to commercializing a breakthrough discovery is rarely a linear process. The orderly rationale of the scientific method is often overtaken by the random artistry of passion, personality, business culture, and sheer luck. Each plays a significant role in handicapping success or failure in that wending transition from bench to bedside. The story behind drug development is thus as interesting as a dime-store novel, except what is fiction in the second case is truth in the first—and always the developer’s own dime is at stake.

Pfizer’s crizotinib—a new targeted therapy that blocks progression of a genetic alteration in a subset of patients with non-small-cell lung cancer (NSCLC), extending survival well beyond the current standard of treatment—is revealing on two counts. The compound’s extraordinarily fast development timeline shows that improvements in basic science around molecular biology are bringing more order to the process of moving from POC to confirmatory trials that conform to regulatory requirements for an accelerated NDA. At the same time, the path for crizotinib was littered with unforeseen risks, best exemplified by a chancy decision on clinical testing that, instead of yielding a medical breakthrough, could have shut the door on an entire field of investigation and potentially harmed Pfizer’s reputation.

With reference to the speed of the science, several institutional drivers helped pull crizotinib out of the filing cabinet and into active development. First was a seemingly unrelated commitment by Pfizer to expand its research capabilities in Asia to accommodate the region’s demand for data relevant to local clinical conditions. Governments like Korea were committing significant funds to facilitate home-grown research, particularly in oncology where the disease profile bore distinctive variations compared to the US. As a result, Pfizer began looking at how various tumor suppressing therapies based on the ALK and MET gene alterations could be leveraged against additional tumor types, including those prevalent in Asia.

“During the dose escalation part of the Phase I study of crizotinib in the US and Korea, we observed early responses in patients with advanced NSCLC,” Darrel Cohen, senior director in the Pfizer Oncology Business Unit, tells Pharm Exec. “Given our strong local networks, we were able to connect the dots and apply this knowledge quickly to expand the Phase I clinical trial and initiate a Phase II study of crizotinib in ALK-positive NSCLC. And despite the limited test population evidence, we were able to take the risk of expanding the trial to focus on establishing how crizotinib suppresses tumor growth among those patients with advanced NSCLC harboring ALK rearrangements, a group that represents approximately 3 percent to 5 percent of the entire NSCLC patient population.”

Pfizer contends that crizotinib is not only a potential therapeutic leader, but a benchmark in new ways to facilitate development partnerships across regions and markets. The success of this approach is exemplified by its joint simultaneous filing submissions on crizotinib to the FDA and the Japanese Ministry of Health Labor and Welfare in March of this year.

But there was also real risk in going global. The expanded trial proved more complicated than expected, involving extensive outreach to academic partners and regulatory authorities in Japan and Korea. In both groups there was concern about the generally precarious state of health among the candidate clinical trial population, most of whom were in the late stages of the disease. This was compounded by the cultural and medical practice gaps between the two countries that proved to be a potent challenge in defining and communicating the clinical trial protocol.

In one instance, Pfizer had to make a wrenching choice, says Oncology Business Unit Regional President for Asia, Jorge Puente. “We had a strong test candidate associated with one of our key academic research partners in Japan. The patient was at that point near death but our assessment was that getting him to the trial center in Korea might possibly prolong his survival and enhance the clinical relevance of the data. So we decided to pull out all the stops in registering the patient, including getting the Korean regulatory officials to accept his entry to the country, obtaining approval of the institutional trial review board, ensuring the patient’s informed consent with the government oversight required under Japanese law, and arranging logistics and transport for a subject who by that time was on a respirator.”

Puente notes that there was an acute awareness within Pfizer of the risks involved, but, he says, “by limiting the population to the US and Europe, we decidedly could not have achieved the rich response rate that allowed us to file globally with this early data.” From a societal point of view, the availability of this type of therapy to patients could have been set back years.

As it happened, the 27-year-old patient survived the trip, was administered the drug, and within two days was off the respirator and walking unaided.

In a world where individual accountability has grown opaque, it is still true in science that reputations and livelihoods can be put on the line, often around statistically assumptive outcomes whose interpretation in the clinical setting can deliver life—or death—to thousands of patients.

William Looney, Editor-in-Chief

The code, which is open for public comment until June 30^th, states that “no gifts, pecuniary advantages or benefits in kind may be supplied, offered or promised to persons qualified to prescribe” a drug. Additionally, “gifts for the personal benefit of healthcare professionals (such as tickets to entertainment events) also are not [to] be offered or provided,” the code states.

However, some concessions are made for continuing medical education (CME). For example, pharma companies may provide monetary assistance covering “actual travel expenses, meals, refreshments, accommodation and registration fees” for physicians, but the events and expenses “have to be organized in India only…and incurred only for the events held in India.” Assistance funds are not to be extended to “spouses or other accompanying persons” hoping to travel to CME events, and companies are barred from organizing meetings that “coincide with sporting, entertainment or other leisure events or activities.”

On his MedCom Strategies blog, Dr. Neelesh Bhandari, a New Delhi-based medical communications consultant, took issue with the rule about meetings coinciding with other events. “This is a totally uncalled for limitation. Why shouldn’t healthcare professionals attend meetings because of the IPL [Indian Premier League] being held at the same time?” wrote Bhandari. The IPL is a professional cricket league.

Other proposed rules in the code limit drug sampling “to prescribed dosages for three patients,” and sample packs “shall not be larger than the smallest pack presented in the market.” Providing samples of “anti-depressant, hypnotic, sedative or tranquillizer” drugs in any amount or packaging unit is disallowed, under the proposed code.

Regarding textual and audio-visual promotional material, marketers are prohibited from using the “names or photographs of healthcare professionals.” Marketers are also asked to avoid “extremes of format, size or cost of promotional material.” On his blog, Bhandari wondered if that rule would “limit the size and costs in pharma marketing projects.” Audio-visual material “must be accompanied by all appropriate printed material” as well, prompting Bhandari to suggest that “this could kill digital pharma marketing in India.”

The full document and code is available here. The regulations are voluntary for now, but “its implementation will be reviewed after a period of six months form the date of its coming into force, and if it is found that it has not been implemented effectively…the government would consider making it a statutory code,” the document says. The Department of Pharmaceuticals is a division of India’s Ministry of Chemicals and Fertilizers.

On a call with reporters yesterday, Murray Aitken, executive director of the IMS Institute for Healthcare Informatics, said adoption rates for biosimilars are challenged by manufacturing complexity, patent exclusivity periods and an untested regulatory pathway in the U.S., plus a reticence “of providers and patients to accept biosimilars in place of original brands.” Current U.S. law allows for 12 years of patent exclusivity for new biologic drugs, although the Obama Administration’s proposed budget for 2012 would shorten that period to seven years, and prohibit the practice of “evergreening,” or making minor changes to a drug in order to extend patent exclusivity.

“We’re not expecting the U.S. regulatory pathway to be cleared, such that biosimilars can enter the U.S. market until 2014,” said Aitken. “We’ve been watching this in the European market, and we’ve seen a pattern where for the first two or three years, the penetration was relatively low, but it’s begun to take off, especially in Germany,” although not all European markets have been keen to adopt biosimilars. “I think it’s fair to say that we expect in the 2015 to 2020 period, biosimilars will see a high rate of growth and share of the market,” said Aitken on the call.

Total spending, globally, on all medicines is expected to cross the trillion dollar threshold by 2015. That figure represents a slowdown, from 6.2% growth over the last five years, to between 3%-6% estimated growth between 2010 and 2015, according to the forecast. By 2015, emerging markets will represent 28% of worldwide spending, up from 18% in 2010. IMS’s designated emerging markets include China, Brazil, India, Russia, Mexico, Turkey, Poland,Venezuela, Argentina, Indonesia, South Africa, Thailand, Romania, Egypt, Ukraine, Pakistan and Vietnam. Spending rates in China are expected to grow by 19-22%, more than any other country. Spending in China increased by 23.9%, to $41.1 billion, between 2005 and 2010.

The top three therapeutic classes in 2015, according to the forecast, are likely to be oncology ($75-80 billion), antidiabetics ($43-48 billion) and respiratory products ($41-46 billion).

Aitken noted on the call that off-invoice drug discounts,increasingly offered to payers in the U.S., France and Germany, were not reflected in IMS’ forecast. The estimated amount of such discounts in 2010 is $60-65 billion, he said.

The full report is available as a free download here.

Emerging markets remain the ace in the card deck for big pharma seeking alternatives to the global slowdown in demand for medicines.  The “pharmerging 17” are dealing a strong hand, with a consensus for continued double-digit growth in drug sales from these markets as their overall economic performance surges at par or even above potential. Suggestions from the International Monetary Fund [IMF] that China may surpass the US to become the world’s largest economy earlier than anticipated – i.e by 2020 – indicates just how profound the potential is for a recalculation of the profit stream for big pharma going forward. 

But as Pharm Exec has noted repeatedly, metrics and numbers don’t always tell the true story – particularly when local governments intervene to shape the market and distort this potential in line with short-term industrial policy objectives.   There is growing evidence of this in the four BRIC countries, all of which are implicitly following a more discriminatory stance on investment linked to performance requirements aimed at foreign-based drug makers.

One of the more interesting case studies on this approach is taking place in Turkey, which is relying on non-tariff barriers [NTBs] to benefit domestic generic companies by slowing local distribution of foreign-made medicines.  Specifically, the government is requiring that all such medicines undergo a separate GMP certification inspection, creating an enormous backlog of applications that has enabled the generic firms to build domestic market share effectively without competition from innovator drugs developed largely by the foreign firms.

According to the Association of R&D-based companies [AFID] in Turkey, 300 applications for the mandated GMP inspection are pending 13 months after the new GMP rule went into force, including 61 novel therapies for CVD, 40 for cancer and 33 anti-infectives.   Despite the backlog, the Ministry of Health has been willing to assign only a handful of multilingual inspectors to certify GMP compliance, a task that can also require visits to sites outside the country and for which few government funds have been allocated.

While these originator products languish in the queue, the average waiting time for a NCE to gain all the registration approvals necessary to go to market in Turkey has stretched to 772 days, or more than two years, an eternity in today’s era of crimped product life cycles.  According to AFID, this compares to about 200 days in the neighboring EU.

The lesson?  Enjoy all that talk about double-digit revenue growth, but also get used to more novelty in the tools emerging market governments use to discriminate. And as this taffy-like thicket of Turkish bureaucracy reveals,  NTBs are one emerging tool for emerging markets interested is helping move that growth curve back to local industry.

While intellectual property (IP) protections and the Chinese government’s willingness to pay for expensive new products represent two large and lingering question marks, Joe Panetta, president and CEO at BIOCOM, said his last trip to China was surprising.

“We visited one of the largest pharmaceutical companies in China – Yangtze River Pharmaceuticals – which is pretty strongly government-backed and which has been long known to be a generics and traditional Chinese medicine company,” said Panetta, noting a statue of Mao Zedong in the company’s courtyard. “When I got there, not only did I see their long-established generics manufacturing facilities, but I also saw their 14- and 10-story innovative research towers that are under construction. They assured me that the future for them is not in generics, and the CEO said clearly to us: ‘I want to meet companies in San Diego, and I want to access new therapies that we can commercialize here.’”

Panetta said a portion of China’s population – by some estimates a portion as large as the total US population, according to Panetta – is becoming increasingly affluent, and has the “desire to access new therapies as well as the means to access new therapies.”

Despite a rising tide of affluence in major cities, many people living in China’s outer provinces are still in need of basic medical services, a problem China’s ambitious, $125 billion health reform initiative hopes to alleviate. “First they have to build delivery centers, and [the Chinese government] is talking about building hundreds of hospitals and thousands of clinics throughout the provinces in China, and they have to first deliver basic therapies and diagnostics and devices, but the question is how soon will it be before the government begins to take an interest in more innovative technologies,” said Panetta. “They have a long way to go, but to me, what that says is that there’s a lot of opportunity for a long time in China.”

The best way to enter the Chinese market is through partnerships, said Panetta, citing talks with companies residing in “large biotech parks in Shanghai and Beijing, and the China Medical City that’s being built from the ground up in Taizhou,” as well as US and European pharmaceutical companies that have a presence in China. “The Chinese would love for our companies to go over there and set up shop,” said Panetta. “What they tell us is that they want to learn how to innovate…I think the payback for our companies is clearly the 1.3 billion person market in China.”

BIOCOM hopes to facilitate partnerships with Chinese companies through conferences and trips to China, in order to “understand who we can build relationships with, what those relationships need to look like, and where we can build those relationships,” said Panetta. “[US] companies need to be careful about how much of their intellectual property they take to China when they create partnerships, and how much they keep [in the US],” said Panetta, and concerns remain about the level of talent and skill that exists, beyond the research level. “Several years ago, the discussion on Asia tended to gravitate toward outsourcing, low-cost research and low-cost early stage discovery efforts,” said Panetta. “That’s changed pretty drastically. It’s a terrific opportunity four our life sciences industry in Southern California,” he said.

Billed as the first Chinese product development partnership (PDP), the Global Health R&D Center of China (GHRC) hopes to discover and develop new treatments for tuberculosis (TB) and other diseases by collaborating with pharmaceutical companies, the Chinese government, academic institutions and other groups, according to a statement.

The GHRC was created through a partnership between The International Scientific Exchange Foundation of China (ISEFC), a translational sciences group, and the TB Alliance, a not-for-profit organization focused on developing new and better TB medications.

Mel Spigelman, president and CEO of the TB Alliance, said in an email that pharmaceutical companies stand to gain from sharing resources, such as intellectual property, with the GHRC. “The GHRC will offer companies financial and world-class discovery and clinical development resources to advance compounds for neglected diseases that they otherwise may not be able to [develop] on their own,” said Spigelman. “In addition, companies will establish strong working relationships with key discovery, regulatory, and clinical resources in the fastest-growing pharmaceutical market in the world.”

The TB Alliance has drug development partnerships with AstraZeneca, Bayer, GSK, Novartis, Sanofi-Aventis, and Tibotec, and is currently managing three drug candidates in clinical trials, according to organization’s website. Spigelman declined to specify which compounds the TB Alliance itself will contribute to the GHRC.

“The vision of the GHRC is to focus on translational medicine for public health and bridge the innovation gap that currently exists into new treatments and cures,” said Geng Jianyue, secretary-general assistant of the ISEFC, in a statement. In China alone, some 1.3 million people develop active TB annually, and 150,000 die from the disease each year, according to the TB Alliance.

A recent World Health Organization (WHO) report found that only a 10% of the multidrug-resistant tuberculosis (MDR-TB) cases identified globally received treatment in 2009. The WHO report called multidrug-resistant and extensively drug-resistant tuberculosis a global epidemic, and TB in general kills almost 2 million people each year, according to the TB Alliance. The announcement of the GHRC coincides with World TB Day, which is celebrated on March 24 each year, to commemorate Robert Koch’s discovery of TB bacillus, the cause of the disease.

While access to treatment remains a major problem in many of the 27 countries most burdened with MDR-TB, the treatments themselves, many over forty years old, present further difficulties, since first-line drugs like isoniazid, ethambutol, pyrazinamide and rifampin require a six to nine month regimen. Failure to adhere to a treatment regimen can result in drug resistant strains of TB, which require second-line drugs, many with severe side effects.

In addition to developing new TB treatments and addressing other public health diseases in China, the GHRC will also develop compounds for the rest of the developing world, according to Spigelman. “Global development programs will likely be partnered with disease-specific PDPs or with global pharmaceutical companies, who will then work with GHRC to register the compounds throughout the world,” he said.

The Arabian, Persian and Turkish Middle East may currently produce only 4% of the world’s scientific literature, but the output is growing rapidly, according to a new Global Research Report from Thomson Reuters. Indeed, countries such as Iran and Turkey are outpacing Asia and Latin America in rate of increase, the report reveals.

And key to the continuation of scientific progress in the region, writes Egyptian-American chemist Ahmed Zewail in the report’s Foreword, are three essential ingredients: expanding educational opportunities, the establishment of centers of excellence in science and technology, and — particularly prescient given the ongoing unrest in North Africa and the Middle East — the encouragement of “freedom of thought.”

At Thuwai, the King Abdullah University of Science and Technology “aims to attract 250 faculty and 2,000 post-graduate students from around the world” in the next 10 years. In Qatar, at Education City, seven US universities have opened campuses. And Abu Dhabi is focusing on developing a more sustainable economy through programs such as the Masdar Initiative, “which will eventually house 50,000 people and 1,500 businesses focused on renewable energy and sustainable technologies.”

As the report says, “historically, the Islamic world is widely recognized as having contributed signally to the foundation of much of the world’s understanding of science.” These new initiatives point to a welcome new emphasis on scientific development in the region. The long-term challenge will be to invest in the education systems in order to “develop a pool of high quality, locally trained graduates and faculty members” to keep such initiatives afloat. Only such institutional growth and development, the report concludes, will sustain the Middle East’s potentially powerful — but as yet “patchy” — scientific resurgence.

This is particularly interesting in that Egypt, Pakistan, and Turkey have been tapped by IMS as leaders of its “pharmerging 17” high-potential markets, followed closely by Saudi Arabia and Jordan. And as Pharm Exec Editor William Looney writes in the March issue of the magazine, the landscape of need in these regions is also promising: “All countries in the region share the common characteristic of youthful populations, high adult literacy, and are experiencing a full-blown transition from infectious to non-communicable disease. Patients want access to modern medicine, and there is a trained professional infrastructure to administer drug therapy. Yet public investment in health services remains low in comparison to other regions.”

For Big Pharma, in evaluating the next stage of the region’s prospects for investment, regime change and democratization will have an impact on the health professions, adds Bill. The definition of share-of-voice ‘elites’ is likely to change. Politically and economically, then, this is a region for the industry to keeps its eyes on.

In 2003, Abner Mason started a non-profit in Mexico. The AIDS Responsibility Project’s primary function was to campaign against discrimination of people with AIDS and HIV in the workplace. Through his work with the Project, Mason—now the director general of the Workplace Wellness and Prevention Council of Mexico (WWPC) and CEO of Corporate Responsibility Partners (CRP)—began to hear about other health-related concerns that weighed on the minds of managers and HR directors in Mexico. The main issue keeping employees from operating at their best (and pushing healthcare and insurance costs through the roof), the companies said, was chronic disease.

Diabetes, high cholesterol, obesity, and cigarette smoking are among the most common chronic health problems in Mexico. In fact, Mason says, Mexico is often cited as the first or second most obese country in the world, with diabetes the leading cause of death in the country. “I was there to talk about one thing,” recalls Mason, “and the companies kept saying, ‘We really want help with programs that would address chronic disease.’ After hearing that for a number of years, I decided it made sense to try to address that need.” Thus, the CRP—and more recently the WWPC—was born.

WWPC currently has 18 members and counting, including giants such as Costo, Pfizer, Johnson & Johnson, Herbalife, Bank of America Merrill Lynch, MetLife, Colgate-Palmolive, General Motors, American Express, Avon, and Procter & Gamble. Employers pay a fee to become a WWPC member, and in return get hands-on assistance with improving the overall health and wellness of their employees, in the form of six key elements: data, education, implementation and evaluation of programs, best practices, public recognition, and policy advocacy. Everything that WWPC delivers, says Mason, came directly from face-to-face talks with employers and from the answer to one question: “What do you need from us in order to effectively improve the health of your employees?” The answer lead to six essential elements:

1) Data. While it may seem simple to many employers in the US, most large companies in Mexico don’t have data on their own employees. So while an employer may know that there are a lot of smokers, for example—“you can see a huge crowd of people outside smoking; every fifteen minutes, all day, there’s a different group out for another cigarette break,” says Mason—not knowing exact numbers makes it more difficult to target wellness programs most effectively or to justify potential wellness programs financially.

2) Education. WWPC sends “wellness coaches” to its member companies, to directly educate the employees about their risk factors for certain chronic diseases or high-risk behaviors. “The [member] companies don’t have the expertise to do that—they’re not healthcare companies,” says Mason. “So we come in as a trusted source not just to educate them, but to inspire them to make the changes in their lives that will lead to better health. Companies said they needed targeted education programs designed to create behavior change.”

3) Program implementation and evaluation. After a WWPC wellness coach speaks to a group of employees at a specific company about a targeted issue—weight loss, for example—the employer may decide they want to cover the costs of a bigger, more extensive program to help their employees reach their better-health goals. Examples of such programs might include a nutritionist or dietitian, or a program such as Weight Watchers. WWPC will act as the middle man between its member companies and such programs, searching the market to find the best match for the employer. “As a Council, we don’t provide those services ourselves,” explains Mason. “We find the best programs for our members and introduce them, and then it’s up to the members whether they want to implement it.”

4) Best practices. “Companies really want to know what’s working and what isn’t,” says Mason. WWPC stays on top of the buzz and acts as a forum to make member companies aware of wellness initiatives that have—or have not—worked for each other. “Many of them have said to me, ‘If General Motors has tried something that didn’t work, why should General Motors repeat that?’”

5) Public recognition. One way to motivate companies to stick with their wellness initiatives is with praise and recognition. It’s this theory that led WWPC to create different levels of recognition in the form of a ranking system: silver, gold, and platinum. “Companies are very interested in communicating—to current and prospective employees, customers, clients, and the government—that they are a company that cares and is taking action to improve employee health,” explains Mason.

6) Policy advocacy. “We have very generous tax credits for companies that invest in wellness programs in the US, but there are no such credits for companies in Mexico,” says Mason. Clearly, such incentive would encourage more companies in Mexico to make wellness and prevention a priority and help to make the private sector more of a partner in terms of the country’s health concerns—taking much of the cost burden off of the government and public funds. “But if one company goes to the government of Mexico—no matter how big that company is—and tries to work with the government to create tax credit, it will not have the impact of, say, 50 companies working together within a council, developing a strategy to enact change.” It’s in this vein that WWPC has partnered with the American Chamber of Commerce in Mexico to develop a position paper supporting such a tax credit. WWPC is also working with AMEDIRH, the largest human resource organization in Mexico, to support the tax credit.

A Win-Win-Win Arrangement
Healthier employees can save money via lower health insurance rates, less emergency care, and fewer doctor visit fees if they focus on wellness and prevention. In addition, companies can save money in terms of potentially less absenteeism and greater productivity among the staff. But there are other, more subtle victories to consider as well. “There should be cost savings across the board if people are healthier,” says Mason.

In an effort to get all the players on board, WWPC has developed a committee to work with insurance companies, because healthier employees should, in the long term, translate to lower costs for the payers as well. “They need to be part of this effort to create an environment where all the incentives are aligned, where everyone is working towards better health,” says Mason. A big step toward this goal of payer involvement occurred when MetLife—the largest health insurance provider of company plans in Mexico—recently joined the Council.

Employees themselves also stand to win, for a number of reasons. Many company insurance plans cover “major medical” says Mason, but don’t cover common issues such as flu and other sicknesses and doctor visits—those expenses are, more often than not, paid out of pocket. In addition to the financial benefit for individuals, “we all want for ourselves and our families long, healthy lives,” says Mason. And if the WWPC can show measurable results in Mexico, Mason intends to extend that collaborative outlook into other countries within the next five years, including Brazil, China, and India.

Big Pharma’s Role
The Council will be making its public debut in Mexico City with a media event on May 26 of this year, and hopes to have 100 company members by this official launch date.

In the meantime, there is something that pharma companies can contribute to help the Council reach its wellness goals—and many already are. Mason says some pharma organizations have already reached out to WWPC and offered to help sponsor some of the Council’s initiatives, including offering funds to help with the cost of sending wellness coaches out to educate employees at member companies. Mason hopes that such offers from Big Pharma will grow exponentially as the Council grows.

“Pharma has as much—if not more—expertise than anyone else when it comes to addressing the chronic disease challenges,” says Mason. “It’s great for them to find a way to take advantage of that expertise.”

Mason also believes that those in the pharma industry could help provide training to the Council’s wellness coaches, and help them determine how to best educate employees.  “We want to make sure that we’re always seeking out new solutions, and frankly, the pharmas have developed some of the best new drugs and other technologies to help people address these challenges,” he says.