Read the Conversation
EF: What do you believe the future of South Africa's healthcare will be in 2023?
BM: South Africa is going through a multi-year transition process regarding healthcare. These are the starting points for the conversation amongst various stakeholders. Healthcare professionals have come to the realization that opposing viewpoints and objectives are no longer appropriate given the current circumstances. We have reached a turning point where it is acknowledged that all stakeholders must work together to address the challenges in delivering healthcare. Since we all have the same objectives, I am optimistic that this is the beginning of much greater communication and collaboration between a variety of different people.
EF: Could you briefly describe the operations of Astellas' South African subsidiary?
BM: The pharmaceutical sector experienced growth of roughly 7% over the previous year. If you translate that into what it means for a business like Astellas—where we only work with prescription medicine—the whole RX market expanded by around 2.5% over the previous year. The Astellas group had a 3% increase from the previous year. There are a variety of causes for this, including generic pressures on our late-life cycle medicines in our established product portfolio. Despite this, we have seen significant growth from new drugs we have introduced to the market in the previous few years, which is encouraging for the future. A small tradeoff that occurred during the past year resulted in growth that was less than anticipated but remained in line with the total prescription-only market.
EF: What does access mean for Astellas?
BM: Access to Astellas has always meant getting the right medication to the right patient at the right time and at the right price. That is the main point. We are working to get the proper medications in the hands of patients who frequently have significant clinical needs. Astellas is focused on achieving this, as evidenced by our company strategic plan and goal. To translate cutting-edge science into value for patients, it is important to ensure that we remain at the forefront of healthcare reform. That does not result from developing products where the market already offers a wide range of opportunities. We are examining the area where patients are underserved.
There is a strong opportunity in South Africa which is crafting a regulatory framework that can allow increased access to innovative medicines. We are aware that the regulatory bodies have been working and investing in streamlining their capacity to approve the introduction of new products.
Another consideration for all growing markets is their historical context in comparison to some of the more established ones. If we look at our product portfolio in South Africa, our mature portfolio still contributes the most to our business. The transition to highly specialized drugs has already been made by some of our European affiliates, and I fully anticipate that we will move towards this in South Africa too.
The question is how to manage the transition from an established product portfolio to one that embraces targeted oncology products, gene therapies, etc. That issue still plagues us, and many international corporations are in the same boat. The boundaries of science are being increasingly pushed by global business strategies for innovative enterprises. The costs increase because there are fewer patients. We want to concentrate on three components, and we want to work with regulatory bodies to help tailored innovations enter the market faster.
To increase affordability, we must come up with creative solutions that satisfy the needs of all stakeholders. In addition to ongoing policy talks over pricing policy in South Africa, the industry is looking at whether alternate reimbursement methods are viable. There are some areas where we think there needs to be some development in order to bring innovation to the market, and then there is also the matter of intellectual property. It’s important that innovation is encouraged and intellectual property laws play an important role, therefore it is crucial that the industry and government collaborate to ensure that intellectual property law reforms support the introduction of innovations into the market.
Emerging countries like South Africa frequently lagged behind developed markets by five to ten years when we introduced new products to the market in Europe or the United States. They eventually succeed in bringing those innovations to market, but it takes a lot of time. Also, the expenses related to bringing such kinds of items to market are transferred to the healthcare systems. Cost-wise, healthcare systems are becoming more and more constrained globally and we need to work together to ensure that the value of new innovations is understood at a price that is acceptable to the market. It is undoubtedly more pronounced in developing countries, but it is a problem that healthcare systems in developed markets also face.
EF: What do you preserve and what do you discard from the COVID digital transformation moment, and what do you believe will be required in the future as the industry continues to evolve?
BM: With regard to that, we are still learning. COVID encouraged the adoption of a digital strategy earlier than many firms would have if they had been left to their own devices and evolution. That is one positive outcome of COVID or one of many positive outcomes that have resulted from the experience with COVID. The ability to be adaptable and attempt new things in a way that allows us to gain valuable lessons is really encouraging. This has caused us to change how we interact with our stakeholders, and we plan to keep doing so.
Having previously worked in the FMCG industry. What we have seen in pharmaceuticals, such as consumer insights, is completely different from the work FMCG was doing on understanding customer insights. From a business perspective, that is something we have learned from the entire digitalization process: we must better understand our customers if we are to offer them value.
The role of digital will alter as we advance and transition to a more specialized portfolio. If your portfolio is heavily focused on primary care and you have a sizable prospective client base, it is not simply about your customer reach growing with digital. Moving forward, the ways we must interact with customers in the digital world for specialized medicines must also alter. Through an omnichannel approach, which we are particularly focusing on, our customers are already enhancing the consumer experience. Even in a developing nation like South Africa, the use of telehealth by medical practitioners has grown significantly. Making sure that we consider the patient's overall outcomes is important, not only focusing on curing or treating their disease.
EF: What skill set do you believe will be necessary for the South African pharmaceutical industry in the future?
BM: The first thing the individuals in the organization tell you in every nation where I have operated is that every country is different. We are, in fact, on a continuum, and where you are on that journey depends, on the stage you are in. You might not even be travelling down a different road. You can simply be in a different stage of that journey, and I believe the same is true of our South African healthcare professionals. I believe they are also undergoing a digital transformation.
I believe that the second aspect of that is that South Africa is not producing enough new medical professionals. Compared to other nations with comparable GDPs, the number of doctors per patient is low. In order to replace the doctors who are nearing retirement, we may not be training enough new physicians. I believe that many healthcare professionals are searching for career opportunities outside of their home nation.
Taking a far more digital approach to how medicine is provided in healthcare has some significant advantages. We must admit that it is the same for us in our sector. Other nations, like South Africa, will be following suit and lagging behind on that continuum while countries like Singapore, Saudi Arabia, and the United Arab Emirates are really pushing boundaries.
EF: What can South Africa learn from nations like the United Arab Emirates and how can you use your experiences from those nations to help it advance?
BM: They are significant variations between those nations that help to foster the proper microenvironment for the advancement of new technologies, including digital approaches and novel medications. Saudi Arabia and the United Arab Emirates in particular, in my opinion, are in a advantageous position since they do not necessarily face the same economic and financial constraints as a nation like South Africa. It would be difficult to compare their position to that of South Africa.
I believe that all governments are working toward a universal healthcare model in some way, and they will all take different paths to get there. A shift toward universal healthcare has been observed in the UAE, particularly in Saudi Arabia, and in nations like Egypt. Although the exact shape it takes will vary, everyone is on the same route to achieving that goal.
I am aware that Nicholas Crisp has done considerable research on this issue and has examined a number of nations that have put in place some kind of national health system or national health insurance. Universal Healthcare Coverage is a UN Sustainable Development Goal and an aspiration for all countries. How UHC is implemented in each country will vary, but it’s important to take the lessons from each of those nations and adapt them so that they can be applied to your own nation. It won't precisely be the same, but it can still be useful.
EF: When you need to attract resources to the South African subsidiary, what is your sales pitch to Astellas headquarters?
BM: That is a very good question, all general managers grapple with this. Given that there are two aspects to our jobs, one is to promote our business within the nation while working with all the players in South Africa's healthcare system. Another aspect of that is speaking up for South Africa within the company.
Sandra Cifuentes undoubtedly described to you the strategy we have adopted when attempting to find nations where we genuinely want to make significant investments since we believe they offer promising prospects for growth. Saudi Arabia, Mexico, and Turkey are a few examples of nations where we believe there is a lot of promise. There are also a number of additional nations, and South Africa is one of them. These nations are classified as opportunity markets because we think there may be some possibility there, although it is not guaranteed.
As a result, whenever a new product is developed, it is important to evaluate its market potential and decide whether it will be successful as a commercial launch in South Africa.
The scale of the South African pharmaceutical market in comparison to other markets and the size of our company in comparison to some of our South African affiliates are both appealing factors. Our company finds it appealing because we are still profitable—in fact, the products we introduced in the past have performed well. We have extremely strong capabilities within our company, which I think is particularly appealing. Additionally, our organization has a high level of knowledge and expertise, which provides a positive impact on any new product launch. On the other hand, there are social and economic issues that hinder our capacity to expand our company in South Africa, as well as some of the policy issues I discussed before around regulatory time frames, accessibility, affordability, intellectual property, etc.
There are obstacles, but we keep talking with our headquarters in Singapore about the advancements we think we can make there, and that gives people the trust that we, first and foremost, know what we are talking about. We recently introduced a new medicine for the treatment of anaemia associated with CKD, one of the products in our expanding portfolio that we can use. For us in South Africa, that product is crucial. It perfectly satisfies the unfulfilled demand. From an affordability perspective, it is suitable, such that presents a potential for us.
Looking beyond the medication we are bringing to market, we are thinking more consciously, and more responsibly about how we can be part of the solution to the healthcare challenges. If we can play a role in co-creating solutions to these complex issues, then everyone benefits, the healthcare system, our company and most importantly the patients we serve
We have a responsibility to the patients in our countries. That is a change that has occurred over the past few years, especially in nations like South Africa, where there is a much higher understanding of the role that we can play if we are committed to doing so, in assisting in the creation of a better healthcare future.
EF: What would you like your tenure in South Africa to be remembered for when you look back at it?
BM: It involves leading my company through a transformational change that propels us toward a much more promising future. We expect interesting times as we reposition our portfolio and our footprint. Leading the organization through this transition process into something that appears different but is functional for the future comes in first. I believe it is also important for me to contribute to the conversation and offer solutions that pharma can support to revolutionize healthcare during the time I have available. There is a symbiotic relationship, pharma is successful if healthcare is successful. I want to reflect on my time here and be able to say that I helped to advance some of the ideas for improving patient access to better healthcare—not just better treatment, but better healthcare overall.
