Global CRO Market and Business Strategies for Indian CRO

Global Pharma Scenario

USA 47% of global sales - US $650 bn. sales. Growth 8%. USA, Europe and Japan contribute 80% sales E7 countries - Brazil, China, India, Indonesia, Mexico, Russia and Turkey - accounting around one fifth of global pharmaceutical sales. No.1 Company Pfizer. No.1 drug Lipitor (Atorvastatin) company- Pfizer. Sales US $12.9bn. R&D expenditure US $40 bn By 2020 the pharmaceutical market is anticipated to grow more than double to $1.3 trillion 2

Top Ten Therapeutic Areas:

Therapeutic area Fast growing Oncology Anti-diabetic Neuro/CNS Cardiac Respiratory Pain/analgesic Steady Gastro Intestinal Slow growing Anti-Infective Gynecological Dermatological

Market share (%)

Value growth (%)

4.06% 5.00% 9.52% 10.18% 9.66% 9.98%

23.4% 15.0% 13.0% 9.9% 8.9% 8.5%

17.46%

3.5%

6.04% 6.04% 5.35%

8.3% 7.5% 6.05% 3

India - Natural choice for CR services

1,00,000,000+ Potential Study Subjects 30 million patients with cardiovascular diseases 25 million with Type 2 diabetes 10 million with psychiatric disorders 2 million cases of cancer with 5,00,000 cases detected every year 600,000 practicing physicians 14,000 hospitals 7,00,000 beds 17,000 medical graduates per year
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India Offers
Right patient pool Genetically & culturally diverse population Patients from multiethnic and multiracial backgrounds Availability of Medical, Pharmacy and Science graduates Excellent infrastructure facilities Comparative cost advantage Changes in the Patent Laws Healthcare professionals think, speak & write in English - 100 million English speaking people (Largest outside US)

Global Business Opportunity

Indian CR industry will witness a business of Rs 10,000 crore creating a demand of 50,000 professionals in the next 5 yrs. By now, upto 30% of global trials takes place outside USA & Western Europe India can capture approximately $1 billion worth of Global clinical research spending by 2010. Data Management Forms 40% of the Business Total Opportunity size for Data Management is 400-600M USD which will be outsourced to India Last year Wyeth alone outsourced 3 million pages of CRF to Accenture at Bangalore India has all the ingredients to conduct Clinical Research to tap $70 billion opportunity in Clinical Research and Clinical Data Management System.

Today India is identified as a major resource center for conducting clinical trials and data management services.
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* - Source:McKinsey

CRO Industry Analysis

Widening Operations of CROs

Over 50 CROs in India Many pharma Cos. have their own CR Units conducting trials in 80-100 government & private hospitals. E.g. Eli Lilly is conducting 17 global & local CTs in 65 locations No. of companies participating in CR is increasing Large Indian pharma companies (DRL, Ranbaxy, Wockhardt, Sun Pharma, Lupin) working on NCEs, have established their own CR units to conduct trials for their new molecules. IT Companies (Cognizant, HCL, IBM, Infosys & TCS), making investments in Data Management

Clinical Research Organizations - Revenues

CRO Revenue growth worldwide, 1993-2007
16 14.4 14 12 10 Market size 8 (USD in Billion) 6 4 2.4 2 0 1993 1995 1997 1999 2001 2003 2007 1.6 3.6 5.5 7.7 9.3

9 Source: SMA Report

CRO Industry analysis

(Value in USD-Billions)
Preclinical, 17.39%

Other, 28.70%

Phase I, 6.09%

Phase II-III, 19.13% Central lab, 12.17% Phase Iib / IV, 16.52%
10 Source: SMA Report

Business Challenges
3.5 3 3 2.5 2 2 1.5 1 1 0.5 0 0 Phase I Phase II Phase III 0 0 0 0 1 1 1 1 1 1 2
Regulatory Issues Competition Improve Patient Recruitment Retention of Human capital Quality & Delivery Time

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Marketing Strategies for the Business

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Marketing
Marketing Management the art and science of choosing target markets and getting, keeping and growing customer through creating, delivering and communicating superior customer value.

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Strategy crafting
Who are we Who do we sell to The USP Our Portfolio Marketing calendar

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Marketing Process
Marketer
Divides

Market in segments
then decides

The target market

and develops

Market offering
which is

(can be product, service, info, experience)

Positioned as delivering some central benefits

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Market Segments
Consists of consumers who respond in a similar way to a given set of marketing efforts
Geographic Demographic Psychographic Behavioral factor
Neeman

Geography

Capital Basis

Business Sector

USA

Europe

SE Asia

Large-Cap

Mid-cap

Small-cap

Pharma / Biotech

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Target Marketing
Involves evaluating each market segments attractiveness and selecting one or more segment to enter
Undifferentiated or Mass Marketing Differentiated or Segmented Marketing Concentrated or Niche marketing Micromarketing (Local or Individual Marketing)
Neeman

Pharmaceutical

Biotech

Device

CRO

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Market Positioning
Arranging for the product or service to occupy a clear, distinctive & desirable place relative to competing products in the minds of target consumer. It includes developing a marketing mix for each segment Neeman has positioned itself as:
A CRO that provides full range of Clinical research services to global pharma/biotech and device company Meeting timelines with assured quality standards Operations spread all over India Medically qualified staff

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4 Ps

Product / Service Customer Solution Price Customer Cost Place Convenience Promotion Communication

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Managing Market Effort

Analysis

Planning
Develop Strategic Plan

Implementation
Carry out the plans

Control
Measure results

Evaluate results Develop Marketing Plan

Take corrective actions

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Thank You

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