The Japanese Pharmaceutical Industry by Umemura Maki;

Author:Umemura, Maki;
Language: eng
Format: epub
Publisher: Taylor & Francis Group
Published: 2011-08-15T00:00:00+00:00

5 Conclusion

Reconsidering Japan’s business in pharmaceuticals

This book has traced the history of the Japanese pharmaceutical industry since 1945. It explained how Japanese pharmaceutical firms recovered from the Second World War and then caught up with Western firms by importing technologies. The two case studies have also shown that Japanese pharmaceutical firms were able to develop a number of original, innovative therapies, some of which have proven successful in overseas markets.

The emphasis of this book, however, has not been on the achievements of the Japanese pharmaceutical industry, but rather on its relative weakness. Rather than invest heavily in R&D to pursue breakthrough discoveries, most Japanese firms opted to launch many new drugs with limited innovative value that could not be sold in other advanced markets. It was true that a handful of leading firms began to develop global blockbuster drugs and increase their overseas presence. But Japanese firms remained much smaller in terms of sales, workforce or R&D expenditures, and Japan remained a net importer of pharmaceuticals.

The aim of this book has been to explain why Japan’s pharmaceutical industry did not become a global leader, and continues to lag behind the pharmaceutical industries of countries such as the United States, the United Kingdom and Switzerland. I used two classes of medicines, antibiotics and anticancer drugs, as case studies for exploring the overall history of the Japanese pharmaceutical industry. I showed that the experiences of these two sectors were very different, and that the antibiotics sector was the stronger of the two. Japanese pharmaceutical firms were able to develop many antibiotics that came to be produced under licence in other industrialized countries. Japan’s anticancer drug sector was far less successful; it developed fewer globally competitive drugs and remained heavily reliant on imports.

There were several reasons why Japan’s antibiotics sector became stronger than the anticancer drug sector. Both sectors were heavily shaped by government policy. The MHW’s tendency to prioritize universal access to prescription drugs, however, had a disproportionate impact on the anticancer drug sector. The government’s cost containment measures, to set drug prices and reduce them regularly, limited the profits that pharmaceutical firms in Japan could gain from launching new therapies. Japanese firms were reluctant to invest in anticancer drugs, which were much more expensive and difficult to develop compared to antibiotics.

As the previous chapters showed, the search for new antibiotics was a more low-cost, labour-intensive and serendipitous process compared to the search for new anticancer drugs. In addition, whereas a given antibiotic could treat many infectious ailments, a given anticancer drug could only treat a particular type and stage of cancer. Antibiotics were more suited to mass production and allowed R&D expenses to be recovered over a larger number of consumers.

Pharmaceutical firms in Japan had much less incentive to develop anticancer drugs compared to antibiotics. Moreover, the undeveloped medical infrastructure and opaque drug approval process increased the risk and cost of drug development. Moreover, well into the 1980s, there was little demand in Japan for efficacious anticancer drugs, as these tended to have strong side effects.

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