Hungary Report: Redefining Sustainability - Pharmaceutical Executive

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Hungary Report: Redefining Sustainability


Pharmaceutical Executive


18 NOBEL PRIZES


Gedeon Richter Research Building
Hungary's distinction as the pharma hub of the former Soviet Union has been a springboard for its local pharma scene to develop in the past 20 odd years. Indeed, as soon as the regime shifted in 1989, several ambitious entrepreneurs recognized these opportunities, each within their own niche. A great Indian inspirational leader once argued that one can make two mistakes: not going all the way, and not starting. In Hungary, the founders of companies such as Genetic Immunity, HYD, and Biosan have put this mantra into practice by avoiding both. "Following 1989, there were increasing opportunities for private companies to be founded and import products from abroad. The most popular areas of activity were in the automobile and computer parts sector, whereas we recognized the unique opportunity to enter the medical area," explains Gabor Vesztergombi, who still heads the local pharma distribution company Biosan today.

Inevitably, the opening up of the economy brought along a vast array of opportunities for the international pharma players too. Their competitive landscape, in turn, has been changing considerably too.

For innovative companies in Hungary, a carefully selected portfolio of some of their highest-quality products has done the trick in the past. Some of the more recent entrants have shown that a strong focus on nurturing the right stakeholder relations is equally imperative when penetrating new markets. "Wherever we go, the doors are already open. There is an extremely high interest from the medical community even in countries we have never been to before, highlights Celgene's country manager.


Marthin Kwakkelstein, Country Manager for Hungary, Estonia, Latvia & Lithuania at Celgene
Marthin Kwakkelstein established the company's fully-fledged Hungarian affiliate at the start of 2011 and thus, in the midst of the turmoil. "Building up the network with the payers and the other partners" says Kwakkelstein, when asked about his key priorities in such challenging startup phase. "In any discussion on healthcare," he continues, "classically only two or three stakeholders are being involved in discussions, which is a standard mistake that should be avoided. The first reaction is always the doctors, followed by the payers, and the pharma companies. For me, there are two other key players, which are the patients (and their associations) as well as the media. I believe all these stakeholders play a role."


Growth Forecast
Dr. Zoltŕn Jakab, country general manager of Abbott, adds that "without the presence of innovative companies in Hungary, there would not have been any post-graduate education of physicians—and sometimes medical staff as well—for the last 20 years. It sounds similar to other countries in this region, where doctors and healthcare workers are underpaid and cannot afford access to the latest knowledge and developments. Without innovators, the quality of care would not have been the same." What is more worrying for the future of Hungary's healthcare system, however, is the ongoing exodus of the nation's highly qualified medical practitioners. "Overall, many of the young professionals have shifted from the national healthcare sector to the private sector in Hungary, or went on to pursue more attractive opportunities abroad," observes Dr. Lajos Tamás Hodossy, Division Head, Diagnostics, at Roche in Hungary. The brain drain is not just a sector-specific problem either, but rather a challenge for Hungary at large. While Hungary has successfully produced 18 Nobel Prize winners so far, many of the Nobel Laureates received the distinction as nationals of other countries.


György Markovich, General Manager of Astellas
In pharma, many of the sales representatives were traditionally required to be either physicians or pharmacists by qualification, making it relatively easy for most companies to tap into an exceptional pool of Hungarian medical talent. While this situation obviously had no long-term benefit for the healthcare system at large, international pharma has a key role to play in the ongoing nurturing of this talent base. "Even after recruitment, we spend significant resources on training our people, not only on the 'hardware' such as scientific and technical information on the equipment, but also on the 'software,' which includes communication and presentation skills," explains Hodossy. "I strongly believe that people can only be the main competitive advantage today," he continues, "and defines which company can be successful, and which cannot. In general, many of the leading companies have grown to similar levels of technical and marketing expertise, which implies that the difference today can only lie in the people within the organization."


Dr. Lajos Tamás Hodossy, Division Head, Diagnostics, Roche Hungary
Astellas' secret to success in Hungary? "A strong combination of products and people," replies György Markovich. "Unfortunately, several pharma companies were forced to cut down their staff significantly. To adapt to the external conditions in Hungary, we have focused on reorganizing the company and finding a new optimal structure. For the new products for example, we are taking people from the sales force and moving them into other areas like key account management or the medical department," the country general manager of the Japanese innovator explains. Looking back at a turbulent time in Hungary's pharmaceutical and healthcare sector, Markovich feels the inevitable need for every company to adapt to the new circumstances. "Every market has its own problems, and every government is currently looking into measures to curb costs ... The environment is changing rapidly. To survive in every respect and to adapt to these economic changes, you need a completely different way of thinking. One of the most important topics remains market access and represents an area where you really require highly qualified experts," states the company's GM. You cannot expect to meet the challenges of today with yesterday's tools and expect to be in business tomorrow. And as the European economic powerhouses continue to revamp their respective economies, first in line will be the smaller and more agile nations to enter the fast lane of economic growth.


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