Abstract
The Pharmaceutical industry faces several challenges such as a series of patent expiries of major products, the slow pace of the R&D process, a decrease in new innovative compounds, generic drug penetration, and a change in drug policy, and is seeking out a new business model. To overcome these challenges, large global pharmaceutical companies have performed consolidation of companies and entered into emerging markets and generic business, whereas large domestic companies have made acquisitions of overseas companies. In Japan, generic penetration was relatively slow compared with other developing nations but many Japanese companies with a focus on domestic business face a potential sales decline risk from a potential shift to generics by the recent government action, and companies with heavy exposure to long-term listed drugs are under pressure to change their business model. To realign with these changes, there are four major points which companies undertake: 1) consolidation of pharmaceutical companies with chemical companies, 2) strengthening the emerging market business, 3) strengthening the generic drug business, and 4) strengthening the overseas business through acquisition.
