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Parallel Trade in Scandinavia

Parallel Trade in Scandinavia. 14. The underlying process 15. The story 16. Example of a story 17 Price structures 18 Currencies 19 GBP 20 NOK 21 SEK 22 DKK 23 The next few years 24 Next century, the crystal ball 25 References 26 The end, the ecologial approach.

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Parallel Trade in Scandinavia

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  1. Parallel Trade in Scandinavia 14. The underlying process 15. The story 16. Example of a story 17 Price structures 18 Currencies 19 GBP 20 NOK 21 SEK 22 DKK 23 The next few years 24 Next century, the crystal ball 25 References 26 The end, the ecologial approach • Parallel Trade in Scandinavia • Introduction • SMART CLUB • The supply chain • A market, or an ecology • The model, animals in the woods • Scandinavian population • Scandinavian PI markets • Norway • Sweden • Denmark • Differences and similarities • Pharmacies www.perhamre.com

  2. Introduction • A general phenomenon. • Confined to EU and EEA, 16th of July 1998, the Silhouette case in ECJ. www.perhamre.com

  3. SMART CLUB • SMART CLUB, an example. • A one stop shop • A wareouse based on parallel import for branded products • The power is in the retail part of the distribution chain www.perhamre.com

  4. The supply chain PI - a detour • TRADITIONAL • Manufacturers, or trademark owners • Wholesalers • Pharmacies • PARALLEL DISTRIBUTION • New steps, 3 new palyers • A large detour • Discounting • Very effective • Societal benefit • Well adapted to changes Evolution = adaption www.perhamre.com

  5. A market, or an ecology? DTC – Direct to Customer Marketing, may be considered an opportunity to empower the customer • The patient is not informed, and the decision making process is split in 3 for reimbursed medicine • Some criteria for an efficient market: • Large number of non-dominant players • Informed customers • Rational behaviour • The pharmaceutical market is an agglomeration of monopolies www.perhamre.com

  6. The model, the animals in the wood • The market may be described as an ecology • The market is governed by natural selection • Dinosaurs • Fat cats • Birds, examples of effective down-sizing www.perhamre.com

  7. Scandinavia, population www.perhamre.com

  8. Scandianavian PI markets www.perhamre.com

  9. Norway, USD PPP • No 1, Astra Zeneca has decreased turnover • No 2, Merck is on a plateau • No 3, Glaxo is growing • No 4, Pfizer is increasing rapidly • No 5, Pharmacia Ujohn grows slowly • No 6, Novartis decreases • No 7, Paranova, the largest PI company, grows rapidly www.perhamre.com

  10. Sweden, USD PPP • The 3 largest companies, AstraZeneca, Pharmacia & Upjohn and Merck are all heavily affected by PI • Cross Pharma is the 6th largest company in Sweden • Medartuum is the 17th largest www.perhamre.com

  11. Denmark, USD PPP • The largest companies are on a plateau • Denmark is the most ”mature” PI market, the change lately are less dramatic than in Sweden • No 4, Orifarm, has a strong growth www.perhamre.com

  12. -Differences and similarities • Culture • Languages • Political system • Business life • Index of 500 largest/1” inhabitants • Clusters • The national character www.perhamre.com

  13. Pharmacies • Reference pricing (NB VAT) • Generic substitution and empowering • Apoteket AB • Apokjeden and LIS • Amgross • Gatekeepers and police • Socialised medicine is good, market is … www.perhamre.com

  14. The underlying process • Interstate price differentials • Currency fluctations • Cost containment • Pharmacoeconomics, PI is cost minimalisation • DTC www.perhamre.com

  15. The story • Media, or what story do you have? • Basic scripts: • Marketing vs bribery • Marketing dementia or flooding • David and Goliath • What is the essence of drama? www.perhamre.com

  16. Example of a story ”Wrong use and side effects of parallel import is known by 15% of the health personel” • It is expensive to tell • It tries to belittle the PI industry • It puts shame on those selling PI • Do you think it works? www.perhamre.com

  17. Price structures • Denmark • Discounts forbidden • Obligation to sell low cost • Norway • Profit share scheme • Referece pricing • Sweden, one body • Reference pricing • Tenders www.perhamre.com

  18. Currencies • The British story • The Euros • Norwegian kroners, 8,12 the 271199 • Swedish kronors • Danske kroner www.perhamre.com

  19. GBP • The GBP is strong now • PI is booming www.perhamre.com

  20. NOK per Euro • Last year, the krone became weaker • Now it is relatively strong • 261199, it was 8,12 NOK/Euro www.perhamre.com

  21. SEK • Turmoil beginning 1999 • Stabilised now www.perhamre.com

  22. DKK • Very strong Jan 96 • Now stable www.perhamre.com

  23. The next few years • Legal issues, Bayer, Glaxo Wellcome, Paranova, Losec etc. • Price regulation schemes in ES and the UK • Business is opportunistic • PI companies are very effective • Vertical integration • Generics www.perhamre.com

  24. Next century, at the speed of light • 2010 and later, Bill Gates • Flow of goods and flow of information • Internet • Do we need wholesalers and pharmacies? www.perhamre.com

  25. References • Parallel Imports – Effects of the Silhouette Ruling. Swedish Competition Authhority, January 1999. Web site www.kkv.se • Pharmaceutical pricing and reimbursement in Europe –1999 Edition, Dr Panos Kanavos, 24th August 1999, by PJB Publications Ltd • www.sigma.no • www.eaepc.org, catalogue /Members/N-Norway/index.htl • Business at the speed of thought – using a digital nervous sytem, Bill Gate, Warner books 1999 www.perhamre.com

  26. Final, the ecologial approach • The smallest fish: the world is not just • The middle fish: the world is just sometimes just • The largest fish: the world is just www.perhamre.com

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