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Brazilian pharma market increases at rapid clip

By: Bob Moser

June 6, 2014

SÃO PAULO — Brazil was the sixth largest pharmaceutical sales market in the world in 2013 with 58 billion Brazilian real ($26.3 billion) in revenue, up 17 percent from the year prior, and by 2016 it’s expected to rank fourth in the category worldwide, trailing only the United States, China and Japan, according to Emerging Markets Information Service.

Medicine sales in the country should reach 87 billion Brazilian real ($39.4 billion) by 2017, driven by rising household incomes, a growing middle class and rapid expansion for generic drugs, which hold nearly 30 percent market share today and should reach 45 percent within the next three years.

“The growth of small generics producers in Brazil ranks above all else, in my eyes, and they’re demanding very standard [plastic] packaging and bottles to maintain low costs,” Wellington Lentini, vice president in Brazil for Gerresheimer Plasticos, told Plastics News on the sidelines of Brazilian trade show FCE Pharma-Cosmetique, May 12-14.

Brazil’s prescription drugs segment accounted for about 52 percent of the total pharmaceuticals market in 2012, up 12 percent in value and 7 percent in volume compared to the previous year, while the over-the-counter (OTC) segment grew 16 percent in value and 11 percent in volume, reaching a 26 percent market share. Generic drugs claimed 23 percent of the Brazilian market in 2012, up 27 percent in value and 17 percent in volume from 2011.

Throughout Latin America, non-prescription medicines generated 27 billion Brazilian real ($12.2 billion) in revenue last year, and are driving the growth of some of the biggest pharmaceutical companies active in the region, including Sanofi, EMS, Pfizer, Bayer and MSD.

Brazil has become a key growth market for pharmaceutical companies producing OTC medication, accounting for 14 billion Brazilian real ($6.3 billion) in sales between February of this year and the same month in 2013, up 20 percent year-on-year, according to consultancy IMS Health. The Brazilian Association for Prescription-free Medicine Industries (Abimip) estimates further growth for OTC pharma sales of 12 percent this year.

The majority of prescription medication OTC solid oral medicines sold in Brazil come in pre-formed plastic blister packs. Aluminum remains the material of choice for blisters because of its perfect moisture barrier that’s necessary in this humid, tropical climate.

But polychlorotrifluoroethylene (PCTFE), a fluoropolymer barrier film, is gaining market share as a packaging option, especially in the competitive OTC market, where around 200 pharmaceutical producers are increasingly trying to use their pill’s color and shape as competitive advantages in shelf marketing, said Carmem Nicacio Dalla Pria, market development manager in LATAM for Honeywell. That company has pegged Brazil as one of the most promising global growth markets for Aclar PCTFE film use in pharmaceuticals.

“Brazil is our No. 1 focus in the region, followed by Argentina and Colombia, but there’s exponential growth in Latin America overall,” said Fernando Amorim, business director for Latin America with ACG-Pharmapack, an Indian group specializing in machinery and packaging for empty gelatin capsules. “Looking forward, we think there’s great demand here for selling blister-producing machines, and then selling that client the packaging raw material they need for many years.”