I N T E R N A T I O N A L

Foreign Drug Market to Reach $6 Billion Sales outside U.S. and Communist nations should total $6 billion within next 10 years

145TH ACS NATIONAL M E E T I N G

Chemical Marketing and Economics

The ethical drug market outside the U.S. and the Communist bloc nations should reach $6 billion a year at the manufacturer's level within the next 10 years. Now, drug companies sell about $3.5 billion worth of prescrip­tion products a year in these countries, Richard Fenton, president of Pfizer International, told the Symposium on Marketing and Distributing Drug Products, held jointly with the Di­vision of Medicinal Chemistry.

The growing world population and its rising purchasing power will con­tribute the most toward higher drug sales, Mr. Fenton believes. The growth, however, will be more than physical. The world-wide trend toward more regulations for drug safety and effectiveness is sure to grow. There will be more govern­ment attacks, as in the U.S., on the drug industry by other nations of the world, Mr. Fenton says.

The practice of manufacturing the best drugs irrespective of cost is likely to grow, too. During the next decade, drug companies will continue to de­centralize and build small plants, and more major chemical companies, such as Imperial Chemical Industries, Du Pont, and others, will move into pharmaceuticals on a much larger scale, Mr. Fenton predicts.

U.S. Share. U.S. drug companies and their foreign subsidiaries now account for $700 million, or about 20%, of the drug business outside the U.S. and Communist nations. This seems small considering the scientific, sales, and marketing skills of the U.S. drug industry. However, it has only been in recent years that most Ameri­can drug companies have seriously be­gun to develop markets in Europe and Japan.

U.S. drug companies have little strength in major markets outside of the Western Hemisphere except in

Britain and the Philippines, Mr. Fen­ton explains. Seven of the leading 10 drug companies in Britain, for ex­ample, are American owned. But on the European continent, in Africa, Japan and other sections of Asia, the share of the drug market held by U.S. companies is relatively small. In Europe, the large national companies dominate and Japan, too, is supplied largely by its own national firms. Gen­erally, outside the British Common­wealth, the dominant companies, apart from U.S. firms, are the old established German, Swiss, and French firms. U.S. companies have a major share of the Canadian and Latin American markets.

Regulations. Although there is no Food and Drug Administration abroad, each country does have its own drug regulations. Some are easier to comply with than those of the FDA and some are more difficult, Mr. Fenton says. For example, in France, a company cannot even choose its clinician to test a product but most choose a clinician from a panel approved by French authorities. More detailed analytical information is re­quired in France than in the U.S. On the other hand, Britain and West Germany have been almost free from official regulatory control until now.

According to Mr. Fenton, there are almost as many different rules regard­ing drug regulations as there are coun­tries. Efforts, however, are being made in the European Common Mar­ket to harmonize drug regulations, he says.

Another important difference be­tween selling drugs in the U.S. and selling drugs abroad is that in the U.S. most citizens pay for most, if not all, of the cost of the product out of their own pockets. In most other countries, most of the cost of drugs is paid for by national social security systems. As a result, drugs and drug prices have be­come more of a political football over­seas than in the U.S., Mr. Fenton says.

This political factor causes many foreign drug companies to live in an

atmosphere of charges that prices and profits are excessive. Threats of na­tionalization by the state are not uncommon in some countries.

Labeling. The requirements for labeling drug products also differ in foreign countries. In many countries, products must be labeled to show ap­proval by the country's social security system. In some nations, the price of the product must be on the label. When the price of a particular drug is reduced, all inventory in the hands of wholesalers and drug stores must be relabeled, Mr. Fenton points out.

There are problems other than la­beling in selling drugs overseas, too. In Australia and the Netherlands, for example, drugs must be listed for specific uses. There is no reimburse­ment to the patient by the govern­ment if the drug is prescribed for uses other than those listed. Some countries even limit the annual dollar value of drugs which can be pre­scribed for a patient, Mr. Fenton says.

U.S. to Open Trade Center in Milan The U.S. Department of Commerce will open a trade center in Milan, Italy, next January. The Italian trade center will be the fifth such center operated by the Department of Commerce. The first one was opened in London in 1961. In 1962, two more were set up—one in Bangkok, Thailand, and the other in Frankfurt, Germany. A cen­ter in Tokyo was opened this year.

Secretary of Commerce Luther H. Hodges said Milan was selected be­cause it is the hub of Italy's financial, commercial, and transportation ac­tivities. The center is already under construction. It will serve as a per­manent showroom where U.S. busi­nessmen may sell their goods and meet with potential buyers, agents, and dis­tributors from countries of the Mediter­ranean Basin, Near East, and North Africa, as well as Italy.

In 1962, Italy purchased more than $750 million worth of U.S. products. U.S. exports to Italy have increased threefold in the last decade, according to the Department of Commerce.

Sponsored by the Bureau of Inter­national Commerce of the Commerce Department, each center stages about eight shows of related products each year. Participating companies re­ceive market research reports, the serv­ices of professional exhibits managers

84 C & E N S E P T . 2 3, 1963

and U.S. commercial officers, and strong promotional campaigns for their products.

According to the bureau, more than 300 companies have successfully en­tered the field of international trade through the centers. So far, it says, U.S. businessmen using the centers have made immediate sales of more than $9.6 million. Nearly 250 agency arrangements have resulted.

BRIEFS

Pittsburgh-Des Moines Steel Co. is supplying nearly $2 million worth of storage tanks for a $69 million petro­chemical complex now under construc­tion in Argentina. The contract calls for 61 floating roof tanks and cone roof tanks and 15 spherical tanks. The complex will be managed by Petroquimica Argentina, S.A.P in which common stock is held by Continental Oil Co., Cities Service Co., U.S. Rub­ber Co., Fish International Corp., and Witco Chemical Co., Inc.

Rayonier Canada (B.C.), Ltd., will re­open its pulp mill at Woodfibre, B.C., by the end of this month. Operations at Woodfibre, on Howe Sound, were shut down Aug. 18, following an ex­plosion in the recovery boiler. Repairs to the boiler will still take three to four months. Black liquor, which is burned in the recovery boiler to produce neces­sary chemicals for pulp, will be shipped in tank barges to Hoquiam and will be processed there.

Australia's Atomic Energy Commission has been authorized to arrange for the treatment of copper ores in the Rum Jungle plant, near Darwin. One sec­tion of the plant is designed for treat­ing copper ores. It is hoped that the scheme will encourage exploration for and development of copper ores in the area around Rum Jungle. The Atomic Energy Commission can either pur­chase the ore for processing or process it for others for a fee.

Varian Associates is moving the head­quarters of its international operations from Palo Alto, Calif., to Zug, Switzer­land. The change is to be effective on Oct. 1. The company says overseas orders for its products increased 60% in fiscal 1963.

Pleasing consider

RUBBER

A soft talc odor helps sell baby pants. A soap-fresh fragrance adds buy-appeal to shower cur­tains. Hand bags with a simulated leather odor have a real competi­tive advantage.

Perhaps an appealing odor—or freedom from objectionable odor —is just what your product needs!

SINDAR can give you expert assist­ance. Our RESODORS were specifically

esodors ! PLASTICS

developed for use in plastics and rubber. They are easy to use— just add the oil at any convenient point in your process. They'll stand up under your tempera­tures too.

There's a RESODOR to give your product exactly the right odor appeal. May we send you samples

and put our experience to work for you? *R«g. U.S. Pat. Off.

Crtpotatfon> Industrial Aromatics and Chemicals

321 West 44th Street . New York 36, New York

SEPT. 23, 1963 C&EN 85

Please send me sample of Evans p-Aminophenylmercaptoacetic Acid.

Name , Position i L Company A ^L Address _ , ^ f l

p-Aminophenylmercaptoacetic acid should be of interest as a synthetic intermediate, particularly for dyes and pharmaceuticals. Many new compounds may be prepared by reacting the amino group. These reactions include diazotization followed by coupling, amide formation, and reaction with aldehydes to give anils;

Sample sent promptly upon request.

(For additional sulfur compounds, see our ad in Chemical Materials Catalog.)

5,end for data sheet

and somple—use coupon

250 East 43rd Street

New York 17, N.*Y. EVANS

PROPERTIES

Mel. Wt. 183.23 Insoluble in: water, MJ. 1S6-I*7°C BltohoJ,b«H»l»

(decamjh) ""d ehtorofwiR

DJssoc. constant Soluble In: aqueous 1.4 x 10-s add or alkali

EVANS p-Aminophenylmercaptoacetic Acid