Japan, the world's third largest and one of the most regulated pharmaceutical markets globally, is emerging as the new attractive destination for Indian drug majors.
The $60 billion Japanese pharma market, which has a unique regulatory structure and the most stringent quality norms compared to any other global markets, had been a tough market for foreign drug manufacturers.
Indian companies found it hard to make an entry into this geography so far albeit their immense success in other regulated markets including the US and Europe.
Ranbaxy, with presence in over 25 countries, entered Japanese market only in 2005 through a joint venture.
While the company was the first to make a foray into Japanese market from India, the Mumbai-based Lupin and the Ahmedabad-based Cadila Healthcare (Zydus) were the other two pharma leaders who successfully ventured into this market.
The country's leading pharma and biotechnology company Wockhardt is also currently in the process of floating a joint venture in Japan.
It was only an year ago, Ranbaxy announced its first product launch in Japan through a joint venture with Nippon Chemiphar Limited -- Ranbaxy/Nihon Pharmaceutical Industry Ltd.
This joint venture company launched its first co-developed product -- Vogseal, in the diabetes segment in Japan in 2005.
The product will be sold in Japan under the NPI label and will be marketed and actively promoted to doctors in hospitals as well as in clinics by the field forces of Nippon Chemiphar and NPI.
Last year, the country's antibiotics major Lupin made a foray in to this high value market with its joint venture partner Kyowa Pharmaceutical Industry Co. Ltd. And now, Zydus Group -- the parent organisation of Ahmedabad-based Cadila Healthcare has made a successful entity into this market with a wholly owned subsidiary -- Zydus Pharma Inc.
Thus, Zydus has become the first Indian company to have a 100 per cent subsidiary in Japan.
Zydus Pharma Inc will initiate the process for registration of products in 2007. Besides marketing generics, the company will also explore collaborations and alliances with Japanese pharmaceutical companies in areas such as joint research and development, co-marketing, contract manufacturing of APIs, intermediates and formulations.
These firms would include branded or speciality firms, generic drug firms and pharmaceutical venture companies.
Industry analysts said the increasing medical costs in Japan are one of the reasons for the Japanese government to allow generic drugs into this highly regulated market.
Last year, a Japanese industry delegation in India had announced its intention to welcome industry collaborations with Indian companies especially in the area of drugs and pharmaceuticals.
The delegation had made it clear that it has become essential to avail cost effective medication by sourcing 'generic drugs' of high quality from countries like India.
According to Zydus sources, its vertically integrated operations and expertise of over 50 years in healthcare, enables it to provide customised, market specific approach for cost effective and quality therapies even suitable to a strongly regulated Japanese market.
Zydus chairman and managing director Pankaj R Patel said, "Meeting healthcare needs with affordable, high quality therapies has been our constant endeavour. We have been engaged in building healthier communities globally and reaching out to people in the US, Europe, Latin America and across the world. We now have an opportunity to extend our commitment to the people of Japan. We hope to do this by leveraging our strengths and expertise as a global healthcare provider and providing innovative healthcare solutions."
Japanese drug market, which is estimated be 11 per cent of the world pharma market in size, is also the second largest individual market in the world after the US.
The recent global studies show that though the Japanese pharma market is substantial in size, it frustrates the major pharmaceutical companies as it is growing at a significantly lower rate than the average of the world pharmaceutical markets.
Also, the exposure of the global companies into this market was limited as the dominant players are local companies including Takeda, Astellas, Daiichi Sankyo, Eisai, Dainippon Sumitomo, Taisho and Mitsubishi Pharma.