Japan market entry challenges – by P Reed Maurer

Not long ago, the last word in the title would have been obstacles rather than challenges, says P Reed Maurer, long-time Japanese pharma industry watcher and president of International Alliances Limited (IAL), in an exclusive article for The Pharma Letter.

Many believed Japan erected barriers to market entry thus protecting the domestic industry from wholly owned foreign competitors. Most, if not all, of the so-called barriers were imaginary due to the lack of familiarity with Japan as companies were focused on Europe and the USA.

Today the situation is very different. Every major pharma company has an integrated presence in Japan. They believe this is a re-emerging market given the rapid aging of the population and the government support of health care as a growth industry. This means new drug reviews are accelerating, development time lines are getting shorter, and approved drugs gain rapid diffusion at relatively high reimbursement prices.  The theme today is: “Success in Japan is not denied, but neither is it guaranteed.”

Challenge is market share expansion

Market entry for many companies is not an issue because they are already in. Their challenge is market share expansion and “leveling up” the capability of their employees across all functions.  A major difficulty is developing people with a global mind. That is, people who can effectively represent the interests of the Japan affiliate in the home office. This entails more than the ability to speak English. The objective is to develop global leaders.

For companies in Japan we can cite issues which are no longer impediments to growth. They include:a.