AstraZeneca, a global biopharmaceutical company, saw Asia Pacific sales rise more than 7% in 2011 to reach US$6bn. Mark Mallon, the firm’s regional vice president of Asia Pacific and president of China, says Asia is “a fundamentally attractive, high growth region” for the pharmaceutical industry. Over the next few years, he expects the sector to experience strong double-digit growth in emerging markets such as China, Vietnam and India, and low single-digit growth in the more mature markets such as Australia, Japan and Taiwan.

According to Mr Mallon, competition in the pharmaceutical sector in Asia has intensified as major pharmaceutical companies step up their investments in the region across sales and marketing, R&D, and manufacturing. He expects this trend to continue. “Competition from generic firms has also increased, both in established and emerging markets,” he says. In his view, competition from Asian pharmaceutical firms tends to be more intense in markets and segments with a high generics penetration.

Mr Mallon emphasises that profitability in the industry has been driven by innovation—both in terms of new products and new commercial models—and a growing focus on costs. He adds that “Asia’s strong history of innovation presents an environment where creativity can flourish”. AstraZeneca, he says, is innovating across a broad range of its activities in the region, “from the way we partner with other organisations to the way we fund new research and deliver healthcare services”.

On a related note, Mr Mallon also believes it is important for the industry to address the growing needs of payors and to improve access to medicines. There is “an under-served population of people who can only access limited healthcare infrastructures and have a limited ability to pay for medicines,” he says.

For example, in China most of the company’s business currently comes from hospitals in 200 of the largest cities of more than 1m people. Nearly 900m people live outside these cities and the Chinese government is providing major investment to improve healthcare in these communities. “We want to be part of this broader market and build a sustainable business in serving those people,” he says.

In order to do so, the company is working with the China Health Promotion Foundation and the Ministry of Health to improve community healthcare by strengthening the training of its general practitioners. It is also sponsoring a three-year programme that will train 30,000 doctors so they can better treat some common chronic diseases.

Reaching out to underserved segments of the population is perhaps not only a moral imperative for some pharmaceutical firms, but can also prove strategically astute, as they seek to improve ties with governments and regulators in the region, and grow the overall market.