A rapidly ageing population which has burdened the healthcare system both in terms of funding and facilities and is of great concern for the Japanese government.
The fact that more drugs are prescribed in Japan than anywhere else in the world, although the 'overprescribing' by doctors for financial gain has been tackled by the authorities with the introduction of the 'Bungyo' system in a bid to stamp this practice out.
An awkward regulatory system, a slow approval process and cultural differences which have often put off some overseas investors, although recent legislation has attempted to address many access difficulties.
The government which continually putting pressure on the industry to limit excessive growth in medical expenditure, with the next set of biennial price cuts due in 2006. These measures are met with continuing animosity by the majority of Japanese companies.
All change – but is it too late?
After years of indifferent performances and an ageing product pipeline the Japanese industry is on the move. Recovery is painful. The mergers of Yamanouchi/Fujisawa, Daiichi/Sankyo and Dainippon/Sumitomo are indicative of a corporate restructuring many commentators feel has some way to run but which has fundamentally changed the Japanese industry. Many see the future for the Japanese companies will be based on innovative R&D and in export markets, notably China. However, the global market is increasingly competitive for funds and market share – how well the revitalised Japanese companies might fair in these harsh trading conditions is a concern to industry planners and investors alike.
