INNOVATION OUTSIDE THE LAB
As the industry wakes up to the new reality of the Middle East, they have been sourcing some of their brightest minds to head
their regional operations and grow their businesses as quickly as possible. Jan Van der Goten, managing director for Janssen
in the GCC, arrived in Dubai in early 2013 with the task to restructure the company's regional organization to leverage a
new portfolio of breakthrough products. With vast experience in marketing and strategic roles at Janssen in the US and Europe,
Van der Goten is confident that some of the innovative business approaches implemented in those markets can be rewired to
the peculiarities of the Gulf countries. In his esteem, collaboration with authorities, academia and other businesses is the
only way to reach a solution to the pressing health needs of the region, such as diabetes.
"We have had preliminary discussions and there is a lot of traction on these kinds of approaches. The authorities are happy
to work together in a different context. What the new scenario is going to look like is still under discussion and something
that I am uncertain of myself. The important thing at the moment is that we understand the framework that needs to be implemented
beyond a classical marketing approach", he claims.
"A fresh framework will take into account educational needs as part of the budget, because right now is the key moment to
build needed awareness to curb the prevalence of diabetes. This must be done now because the government still has sufficient
funds to manage the burden of the disease for decades to come, but that is only if we manage to control and prevent further
propagation. The answers we seek together with the authorities are regarding how to do this best. Clearly there are some inherent
risks in doing this, but the only way to innovate and generate true changes in how we approach healthcare is by taking risks
and trying new things."
Julphar Manufacturing Facilities
Karim El-Alaoui, managing director of MENA for Boheringer Ingelheim, echoes the need to strengthen alliances in order to drive
business beyond the pills and sales rep model. Contrary to traditional perceptions of competition, Boehringer Ingelheim has
forged a partnership with diabetes expert, Lilly, in order to maximize their local efforts against the disease. El-Alaoui
boasts that "the main objective of this alliance is to make sure that we can provide medications to the patients who need
it. By joining forces we will be able to demonstrate that 1 + 1 = 3, in the sense that more investments will be made in the
field of diabetes. As regards the sales-force it will also be bolstered and essentially doubled as both companies will be
working together to ensure that more patients have access to these products."
"The reality is that as long as companies are enhancing their diabetes portfolios, naturally, they would like to generate
awareness around it. However, industry initiatives are not sufficient – they will never be enough – because it all has to
be done in partnership with the Ministries of Health and medical community of the countries we operate in. The key to effective
awareness is to work with the support and hand-in-hand with local authorities so that we can tackle the disease on all fronts."
From such experiences it is evident that the Middle East is serving as an entrepreneurial hotbed for pharmaceutical executives
who are keen to experiment with innovative business strategies. Pooling lessons from other markets and with incomparable growth
opportunities, managers are willing to take greater risks to excel.
For the last two years Aspen Pharmaceuticals' regional manager for MENA, Tara Banasi, has been responsible for launching the
company's tailored portfolio in the region, which mostly consists of divested products acquired from Big Pharma. At times
this has meant launching 12 new brands within in a 3-4 month period, which has demanded new approaches to individual markets
and a great deal of experimentation.
Dubai Healthcare City
"Across the region, we have many third party distributors who simply take the goods from the warehouses to the customers.
I realized there was no one truly looking after our business in those countries. Many of our distributors lacked the necessary
passion and know-how to drive our products into the market as successfully as I would like. I then decided to hire key account
managers who could take on that responsibility and manage a very strategic portfolio. I started off hiring 20 people in Egypt
through outsourcing companies and many people thought I was crazy because we are speaking about a country of 80 million people.
The outsourcing model, where you pay the people's salary and train them but are not liable for them, is really only seen in
Europe. So far it has paid off incredibly well and we are trying to replicate it in other markets," beams Banasi.
"You can't call Aspen an innovative company because all of our products are bought from other companies. Nevertheless, we
have innovative business models where we are doing something different. In KSA, for example, I decided to hire pure Saudis
straight out of university. I molded them, trained them and paid them well, and these are the people who are responsible for
growing our market share by 30%. No one else had done this in KSA, and the authorities were very impressed by the initiative,
which has gained us much recognition in their eyes."
All the signs are palpable that the Middle East region, led by the UAE, will continue to set benchmarks for the development
of healthcare. But for how long will this golden era last for the global pharmaceutical industry? Estimates predict that
double digit growth will continue for the next three years, after which annual increases will then stabilize around 8-9% CAGR.
Genpharm's Smaira summarizes this forecast succinctly in saying that "the maturity of these markets is being accelerated.
Today a product is launched in Europe and the following year it is here, so these markets won't be "emerging" for a very long
term. As this is a transitional phase in the pharmaceutical market, we think there are still windows of opportunity. The markets
are heterogeneous and strategies have to be different and flexible. Some markets are very brand oriented others are moving
towards a generic model." For the time being, it seems like the Middle East will remain the apple for most pharmaceutical