Daiichi Sankyo Taps Partners To Deepen China Olmesartan Penetration
This article was originally published in PharmAsia News
Executive Summary
Daiichi Sankyo’s new alliances for olmesartan in China recognize the need to adapt to market diversity, as well as the huge potential for cardiovascular products in the country. The Japanese firm has teamed up with two domestic players to deepen the hypertension drug’s penetration as it faces its first loss of exclusivity elsewhere next year.
SHANGHAI - Daiichi Sankyo Co. Ltd. has signed two strategic partnerships with Chinese pharmaceutical companies to market and commercialize its cardiovascular products Olmetec Plus and Olmetec tablets in mainland China, in a move designed mainly to improve penetration of the sector in smaller cities.
The collaborative agreements form part of the Japanese firm’s new business development strategy to promote local sales and target larger market coverage.
The first deal was a long-term strategic partnership with Jiangsu Simcere Pharmaceuticals to exclusively promote and sell Olmetec Plus (olmesartan medoxomil plus hydrochlorothiazide tablets), with Daiichi Sankyo to be responsible for branding activities and the two companies to share future market gains.
Olmetec Plus, an angiotensin II receptor blocker (ARB) combined with a diuretic, was first approved in China in 2012 to treat high blood pressure.
The partnership is the first of its kind that Daiichi Sankyo has established with a domestic company in the field of hypertension for an exclusive right-to-sell agreement, as well as its first nationwide collaboration with a local peer, marking a new stage of deepening collaborative relationship with Chinese partners by the Japanese firm.
The cooperation aims to strengthen the two companies in terms of products and resources on a complementary basis, Daiichi Sankyo said in a statement, noting that Olmetec Plus has strong product differentiation advantages and high brand recognition in China.
The Simcere Pharmaceutical Group is a well-known company with a wealth of marketing experience and the capability to provide professional medical services in cardiovascular products, and Daiichi Sankyo has built up this new form of partnership in order to enhance brand awareness and market competitiveness, for the benefit of Chinese hypertension patients, the company added.
Gloria Partnership
Another marketing and distribution cooperation framework agreement for Olmetec (olmesartan medoxomil) was signed with Shenzhen-listed Harbin Gloria Pharmaceuticals Co. Ltd.’s wholly owned subsidiary Gloria Anbo Pharmaceutical in Shanghai earlier this month.
According to the agreement, Gloria Anbo has been granted exclusive marketing and distribution rights to Olmetec tablets 40mg within mainland China, excluding 30 major cities that Daiichi Sankyo already covers.
In the given regions, Gloria Anbo will be responsible for the promotion and marketing of Olmetec in a range of sales channels, including hospitals, retail pharmacies and the third terminal market. The two companies also plan to discuss marketing and distribution rights for the internet channel in preparation for China’s official release of relevant laws and regulations on pharmaceutical e-commerce.
Launched in 2006 in China, Olmetec is a single ingredient ARB with a stronger antihypertensive effect than other class drugs, and additionally has organ protective effects that can reduce the overall risk of cardiovascular morbidity and mortality over the long term.
Through the partnership with Gloria, Daiichi Sankyo expects to benefit from the Chinese firm’s broader market penetration for a rapid wider coverage in China.
At the same time, Daiichi Sankyo intends to continue to increase the level of national marketing for Olmetec, with continuously strengthened branding in major cities, to achieve overall market success in the country.
China Marketing Strategies
Daiichi Sankyo has already had other alliances for Olmetec in China, teaming up with Pfizer Inc. to co-promote the drug in 2011, with the two companies overlooking past differences to forge the agreement. After four years, the annual sales of Olmetec in China have exceeded CNY250m ($39m), according to the company.
China has a large and complex market, and Daiichi Sankyo has adopted a diversified marketing model to cope with this, said Yoho Tsutsumi, chairman of Daiichi Sankyo China. The standard for collaboration is to communicate and interact with domestic peers, and to set up alliances in line with China’s health care reforms and medical system, he noted.
In 2012, Daiichi Sankyo established a strategic partnership with Zhuhai Rundu Pharma to market Pravachol (pravastatin), which had similar terms to the agreement with Gloria. Daiichi Sankyo continues to strengthen brand building in 24 major cities, while Rundu is developing a broader market through its marketing network in China.
Another active collaboration is the partnership with Sinopharm Medicine Holding Beijing Huahong in pain management. Under this, Daiichi Sankyo and Huahong work together to co-promote a therapy which combines Daiichi’s Loxonin Tab (loxoprofen) for mild to moderate pain and Huahong’s oxycodone and acetaminophen tablets for moderate to severe pain.
This partnership can provide a more complete and reasonable analgesic regimen at different stages in clinical practice, but also can improve business efficiency, accelerating the development and market penetration, according to the companies.
Market, Generics
According to IMS data, global sales of olmesartan medoxomil tablets in 2014 reached $2.3bn, while China sales were CNY209m ($32.4m). In the China Cardiovascular Report 2014 Summary, China's annual direct medical costs due to hypertension were up to CNY36.6bn.
Given the huge market, Chinese companies are also developing generic versions of olmesartan medoxomil tablets, with Beijing Winsunny Pharmaceutical and Shanghai Sine Promod already getting approvals in 2006 and 2011, respectively.
A number of other local companies, such as CP Pharmaceutical Group, Hengrui Pharmaceutical, Qilu Pharma and CSPC Pharmaceutical Group, are also developing generic versions of the drug.
Daiichi Sankyo recently restructured its sales operations in the US ahead of the first loss of exclusivity there in October next year (Also see "Daiichi-Sankyo Slashing 1,000+ US Jobs Ahead Of Benicar Expiry" - Scrip, 19 Oct, 2015.).