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EF: The world is transitioning from the pandemic to a "new normal." How is the "new normal" affecting Latin American health trends in 2023?

SC: In some areas, we returned to pre-pandemic patterns. However, we also observed changes and escalation in a few aspects. From a therapy area perspective, trends are evening out and going back to where they were in the past. In chronic treatments, people are being more adherent to therapy. The halo effect of the pandemic is that people are slightly more concerned about their health and are treating themselves better.

From a demand and drug requirement perspective, the market axis will not change, and the increased difficulty of payers funding the bill will continue. Data provided by the WHO shows how in 2020, under the pressure of the pandemic, there was about a 1- 2% increase in GDP on additional healthcare spending. Most of the expenses were government funded. Now the issue of long-term COVID patients adds concern, raising uncertainty about how governments are going to continue financing healthcare.

In a positive approach, Brazil has a government that wants to spend more on healthcare. The plans focus on basic healthcare, strengthening vaccination programs, indigenous health, and women's health, amongst others. Policies point in the right direction, but success will be largely dependent on execution. Concerning the aspiration to increase industrialization for API production, for example, Brazil has a high cost compared to other global producers. The tax reform coming under discussion will influence the country’s ability to implement these aspirations. To successfully industrialize the nation, the government needs to act cautiously, provide incentives and avoid overtaxing the sector.  

Increasing investment in healthcare is undeniably beneficial for every country. The coming year holds much anticipation regarding the outcomes of these developments.

EF: How will healthcare systems balance personalized treatment with broader access for the population?

SC: The next five years are going to be critical. Many synthetic drugs and biologics are coming off patent, and, at the same time, we observe a lot of activity in terms of potential increased market access for more complex treatments coming from the global R&D pipeline. Access to innovation is lower in Latin America compared to developed countries. In the next five years, we will see several opportunities for increased access to more modern therapies as more biosimilars and generics launch.  

We face unprecedented situations with new therapies, such as gene, CAR-T and NK therapies, which are starting to provide significant clinical benefits.  Increased access to such treatments may come through innovative contracting agreements, as we have recently seen in Brazil. The coming years will set the stage for how governments and payers deal with the opportunities for expanding access as a function of loss of exclusivity (LOE), as well as seeking novel ways of funding more complex technologies targeting niche populations.
It is going to be interesting to observe how these changes are going to impact manufacturers. The portfolio shift will be big, with many large multinational manufacturers moving into increasingly niche areas. These companies today are building “rare disease” business units and strengthening competencies across diagnosis, awareness, and the patient journey much more than before.  
Local players and multinationals focused on generics will have a launch portfolio less dependent on synthetic oral generics. Branded and unbranded synthetic oral generics will still be a strong pillar of business, but what comes off patent is increasingly more complex. Companies will need to shift their competencies because five to ten years down the road, the LOE is going to be on biologics and more complex drugs.

The interaction of the data piece comes as an additional element. The use of real-world data in submissions reached 40% in 2021. We are starting to observe this in Brazil as well. While many payer decisions regarding drug formulary inclusion are budget-driven, we registered increased denials based on insufficient data. We expect the demand for real-world data to grow. This trend will require companies to work more coordinated across market access, commercial, and medical.  
The medical teams, for example, are still largely focused on R&D. To better use their organizational capabilities, companies need to work more efficiently with them across the entire product lifecycle. For instance, Medical Scientific Liaisons have an increased role in communicating value, especially as technology has enabled a much greater reach for these professionals. It is imperative for companies to narrow the gaps and improve the flow between the data submitted and the real-world data necessary.  

EF: How is IQVIA navigating the current transformations and trying to build more collaborative systems between the private and public sectors?

SC: IQVIA has been working across stakeholders to support collaboration on initiatives to improve the efficiency of the healthcare system. We are working, for example, with the industry, payers, and providers to better understand the patient journey. We have a DNA in data and analytics, and this is where we can add much value. We seek to create win-win scenarios, allowing the industry to comprehend how its solutions and technology can enhance the patient journey while enabling the hospital, unaccustomed to analyzing its own data, to gain insights into its patients and identify gaps in their journey.

We have been building those connections and working a lot to connect the industry with the stakeholders, mainly hospitals, providers, and payers. We recently had our yearly congress in Brazil, where we held a roundtable on population health, bringing together stakeholders from patient associations, government, and providers.  

Ultimately, it is all about data and how you use it to optimize resources and improve the outcomes of treating the population.

EF: What progress has been made in technology and data over the past year, and how is it being adopted in Brazil?

SC: Healthcare, in general, is not fast to adopt novelties given the regulations and the risks involved when dealing with human life. However, certain things are evolving positively.  

As Brazil is a rich country regarding data sets, there are initiatives within the government framework to continue expanding and building what has been called Open Health. This initiative shall enable greater sharing and analytics of anonymized data, benefiting the system as a whole.

Digital will continue to play a very important role post-pandemic, as these channels add and contribute to physical meetings. Telemedicine and electronic prescribing remain, and advances have been made in terms of how the stakeholders engage. Taking the industry’s interaction with the medical community through education initiatives as an example, pre-pandemic less than five percent of these contacts were done digitally. Today, we are at 15-25 percent, depending on the country.  

The trend overall is more adoption of technology. Nevertheless, data sharing in Latin America is not easy.  In Brazil, data regulations are good and mirror the European Data model. Data, however, is still very siloed. Stakeholders have been very protective of the information within their systems. This culture shall change over time, enabling better data sharing within ethical and compliant boundaries and respect for patient privacy.  
It is crucial to enhance the understanding of how data sharing generates value for all parties involved.

EF: Where do you still see opportunities to create better structures, partnerships, and regulations to create a more sustainable life science market in Brazil?

SC: Prospects for Brazil are good. The drug demand in Brazil is projected to grow over the next few years. Spending on drugs is expected to grow eight to ten percent annually over the next five years in local currency. Looking ahead, this growth will not solely rely on the private sector. The public sector is also expected to contribute, driven by the intention to allocate more resources towards healthcare.

Congress is reviewing regulations for clinical trials. This regulation is one of the critical elements that could advance Brazil's situation in terms of clinical research by diminishing bureaucracy and setting clearer roles and responsibilities for each stakeholder involved. By reducing bureaucracy while maintaining ethical and safety standards, Brazil will also get more attractive from an investment perspective. Brazil has large CRO capabilities and an extensive and diverse population. Regulatory hurdles slow down study setup, but once initiated, finding patients and recruiting advances quickly. At this point, Brazil is catching up to other countries like Argentina, which historically has had more favorable regulations on clinical trials.

Getting regulations passed through Congress would put Brazil on another level. Currently, the country is Top 10 globally regarding the pharma market size and GDP. Brazil has one of the largest populations worldwide, but when it comes to ranking in the number of clinical trials, the country is still number ranked at roughly 20th. There is a huge opportunity to generate benefits across more research, jobs, and patient access. Regulation is the key piece that needs to go through.

EF: What are key trends for Brazil’s private sector this year, and what are the likely implications for stakeholders?

SC: Due to the situation in Brazil and the pandemic, people returned to the hospitals, causing the expense ratio of the private healthcare payers to rise.  

In Brazil, most private health plans are employer-funded. Negotiations are getting complicated because employers, as ultimate payers, have been taking on increases of about 30 to 40 percent a year. This "medical inflation" is reaching the point where employers must make choices like reducing benefits or increasing the co-pay. The current setting strains the relationship and the finances of the private healthcare structure in the short term. It is going to take one or two years to fix this situation. Health plans are going to increase their prices, and bigger players will survive and use their negotiation power to drive consolidation.

As payers consolidate and verticalize, there is a need for better B2B engagement from the industry and their counterparts. In addition to the physician, the payer lately has become a decision-maker. Similar to the situation in the United States, physicians now need to follow a guideline or a protocol.  In this context, B2B engagements become more relevant for the industry. Even if the incentives of the different stakeholders are not always aligned when it comes to finding common ground as to how to adopt new technologies. Stakeholders need to work together for the efficiency of the entire system.

EF: What advice would you give business leaders and CEOs trying to enter the Latin American market?

SC: Latin America is a vibrant region. The market is dynamic and has lots of opportunities.  

The advice I would give differs depending on the company’s portfolio mix. Yet, the first thing to consider is the payer landscape and building competencies aligned with your portfolio. Most companies, even local players who traditionally focus more on retail, will have to start dealing with payers as they move into biosimilars and complex generics. Companies need to continue to invest in competencies beyond just face-to-face with the physician; Corporation-to-corporation engagements are gaining importance.

To ensure the continual development of capabilities based on real-world evidence, companies need to better orchestrate their different departments and re-think roles, including greater medical, commercial, and market access coordination.

Another factor to consider is digitalization. In our surveys, the industry evaluated itself as still not mature in this aspect. Companies need to evolve in terms of how they coordinate their channels and use them efficiently. That is something they are investing in.  
Lastly, we have to keep in mind the large portfolio shift that will happen over the next five years. Some companies will take actions to protect brands going off-patent while simultaneously driving a new, much more complex portfolio into niche populations. Others are going to move into complex generics. The local players are looking into incremental innovation and increasing the complexity of their portfolios. Many companies are already pushing their business development strategies, closing licensing deals for mature portfolios. We are going to see interesting changes in the next years.

June 2023