Sanofi China GM Fabrice Baschiera On His China Vision: An Interview With PharmAsia News (Part 2 of 2)

Sanofi’s China head sits down with PharmAsia News to discuss how the company jumped in sales rankings to No. 3 in China from No. 10 in only five years.

In five years, Sanofi jumped to the third-largest pharma company in China from the tenth position based on sales thanks to a portfolio that includes primary care products such as blockbusters Lantus (insulin glargine) and Plavix (clopidogrel).

In April, Sanofi reached a deal with Takeda Pharmaceutical Co. Ltd. to co-promote Takeda’s dipeptidyl peptidase-4 (DPP-4) Nesina (alogliptin) (Also see "Takeda, Sanofi Team Up To Explore DPP-4 Market In China" - Scrip, 23 Apr, 2013.).

If Nesina is approved in China this year as expected, it could be ready for the market in time for the new National Drug Reimbursement List, which is expected to be revised next year and DPP-4 inhibitors are likely to be added to the list (Also see "IMS Health’s Yan Shangjun On China’s Changing Diabetes Market: An Interview With PharmAsia News" - Scrip, 7 Jun, 2013.).

Sanofi China GM Fabrice Baschiera has led the company’s China operations since transferring from Sanofi Korea in 2010. Baschiera sat down with PharmAsia News’ China Bureau to discuss Sanofi’s vision for China. He addressed how Sanofi will position its diabetes portfolio in China with Amaryl (glimepiride), Lantus and upcoming Nesina and Lyxumia (lixisenatide).

The expanded Essential Drug List released in March includes Amaryl and bestseller Plavix, and as the manufacturer of China’s bestselling Rx drug Plavix, Sanofi can offer as a case study for multinational companies’ strategies for the expanded list. Baschiera also shared his views on the expanded EDL, the National Drug Reimbursement List and price cuts as an opportunity to access more patients (Also see "China’s New Essential Drug List Adds Drugs For Major Diseases, But Pricing, Market Pressure Likely To Increase" - Scrip, 18 Mar, 2013.).

Part one of this interview appeared here: (Also see "Sanofi China GM Fabrice Baschiera On His China Vision: An Interview With PharmAsia News (Part 1 of 2)" - Scrip, 23 Jul, 2013.).

Fabrice Baschiera

Source: Sanofi

PharmAsia News : By widening access outside China’s big cities, patient visits to hospitals actually come down. How do you make your team more efficient in those markets (Also see "China Reforms Boost Pharma Opportunities In County Hospitals, Community Health Centers – BCG" - Scrip, 18 Dec, 2012.)?

Fabrice Baschiera: The first point is that the team is based in the counties, so they don't have to travel from large cities. This makes their visits more efficient and adapted to the needs of county hospitals.

The second point is the team is promoting the portfolio, not one or two products like other teams. As long as they see a need, they have the possibility to present a full portfolio. This is another big change.

And a third point, which we are already doing in large cities, is that they focus a lot on medical education. They are organizing a lot of meetings and a lot of training, including for key opinion leaders working in large cities to come to counties or using technology like net meetings and videoconferences to organize large training sessions across the country. This is also important because county physicians have a limited chance to attend large symposiums and large meetings in large cities.

So, instead of bringing doctors to big cities, we are bringing key opinion leaders to counties. I think they appreciate what we are doing in that regard.

PharmAsia News: As you are going to launch more diabetes products, are you planning to increase the headcount of your diabetes team?

Baschiera: China is a strategic country for Sanofi, which means that China is seen as a growth opportunity. That's why we have enlarged our presence. We have six factories in China. We have made acquisitions in consumer health care in the last three years. We have expanded our presence both at the headquarters level and at the local level. Our ambition is to continue to grow. With the number of new products that are coming, Sanofi will enter a new phase of development. We haven't launched any new drugs for diabetes since 2004 when we launched Lantus.

Starting from this year and into next year, we're going to launch more drugs than we have been able to launch over the last 10 years. This is a completely new dynamic that the company needs to get ready for. Of course, this is a nice problem to have – how we can make these new products and new launches successful. It's true that today we are looking at reinforcing our launch expertise. We are also reinforcing our presence at the local level because we need more people to present products and to explain the benefits of these products. So, we will continue to expand our presence both at the headquarters level and at the local level, not only with our sales force.

We have about one billion people that today don't have access to our drugs, which is unique in the world. Only China can offer this opportunity.

To give another example, we are now expanding our medical scientific liaison team whose mandate is to conduct medical and scientific communication with health care professionals because we now have a broader offering. We have more products to come, and physicians need to know how to use our drugs more efficiently and which patients they should use our products for. That's why we now need to have a strong medical presence at the local level. We are going to have a large medical liaison team, which will cover most of the top cities in China, not only Shanghai, Beijing and Guangzhou. We will now go deeper to support our large sales force.

PharmAsia News: Recently, China expanded its Essential Drugs List. The most notable thing is that Plavix is now on the list. Is Sanofi going to play in the EDL space with Plavix or would you like to stay away from the EDL? If you stay away from the EDL, can you still keep the National Drug Reimbursement List market, which is generally a bigger market?

Baschiera: We have Plavix. We have Amaryl, as well, in diabetes. We are trying to define the risks and opportunities with the new EDL and assessing our options. The key question is what will be the usage and the implementation of the EDL products today? From what we understand, this is not going to be decided at the central level. It's going to be decided at the provincial level. There's going to be some flexibility province by province to define how they want to use the EDL and pricing. This is something we are watching very carefully to understand the impact and the direction.

It's still too early to say how we see the EDL really impacting our business, but one thing is clear – we are on the EDL, which will ultimately give us access to more patients in China. We want to provide our drugs to more people in China. We still have a long way to go. We have about one billion people that today don't have access to our drugs, which is unique in the world. Only China can offer this opportunity.

PharmAsia News: Some provinces are planning to combine EDL tenders with NDRL tenders. If you choose not to bid on EDL tenders, do you think you could be removed from the NDRL or PDRL tenders?

Baschiera: The combination of the EDL and DRL tenders has not yet been implemented in China. Some provinces have made announcements about this direction, but we haven't seen this happen yet.

A key point for us is to have quality recognized at these tenders. This is a key element to ensure that drugs provide the right level of efficacy and safety to patients. We hope that provinces, when they issue their bidding criteria, will keep quality as a key criterion for purchasing drugs.

So far, we have received positive feedback from many provinces that will recognize quality. But in China, if you want to ensure you have the right price and the right quality and safety, you need to have quality criteria to select the drugs in your tendering. I think the government wants to manage the price but at the same time ensure that drugs have the right quality.

PharmAsia News: We also have seen several rounds of price cuts on NDRL drugs. Do you think volume can offset price reductions? Have you implemented any new policies to compensate for price cuts?

Baschiera: We are in an industry that is regulated, which means that we enjoy some support from the government in terms of reimbursement. This is helping patients. At the same time, we know that our price is controlled by the government. The price cut that we are facing is new in China, but it's not new globally. As long as we still have this opportunity to cover the one billion people that we don't currently have access to, there is a huge opportunity in China. That's why we are investing today, that's why we are expanding our teams and that's why we are bringing new drugs.

Price cuts, I think, will continue. This is a trend that we are observing now around the world. We also need to bring innovation and new drugs. We are going to launch a lot of new products in China. We are entering a new phase of growth for our diabetes business in China.

We're going to have more price cuts on our legacy brands. Our legacy brands will become more affordable and will help us go deeper into the countries. So, we have, I think, the perfect match between innovations, new drugs and legacy drugs, which is helping us go broader and deeper. This will help us bring more drugs, capture new patients and at the same time continue to develop our core value for the future.

One comment I would like to add is we had a very important announcement at the recent ADA, which is the American Diabetes Association meeting. This positive announcement is about our investigational new insulin U300, a potential next-generation Lantus. It demonstrates Sanofi’s innovation in diabetes, and of course, we are working to bring this innovation to China.

Only an innovative pharmaceutical company with the appropriate resources and compliance program can provide the right information and education. And we want to stay in control of the business.

PharmAsia News: You just mentioned you have legacy products and you have innovative products. Some companies, like Pfizer Inc. and Merck & Co. Inc. may spin off their legacy products. Pfizer formed a joint venture with Hisun and Merck, and Simcere formed a joint venture to promote their legacy products. Is that the kind of strategy you are thinking about at Sanofi (Also see "Dance With Domestic Companies: Pfizer And Merck Look To Broaden Market Access In China Via JVs" - Scrip, 13 Sep, 2012.)?

Baschiera: From a strategic standpoint, we made an important decision two years ago to go with our own teams to counties because we think we have the right offering. We did it because we see the need for medical education. I think we need to do that by ourselves. Only an innovative pharmaceutical company with the appropriate resources and compliance program can provide the right information and education. And we want to stay in control of the business.

Because of that, we made the decision not to outsource this business. Moving forward, I think we also have to look at what will be the reaction from the market and what will be the impact in terms of price cuts. There will also be questions that we need to answer about how we manage the new products, the innovative products, and how we manage innovation.

These are questions for us probably two or three years from now. Sanofi has always been successful because we have worked very closely with local companies. Before coming to China, I was in Korea, where we have been a very strong partner for many, many years. Before that, I was in Thailand, where we have a partnership with the government in the manufacturing of vaccines. In China, we partnered with Minsheng in our pharmaceutical business and we have partnered with them again for our consumer healthcare business.

China is a very large market, with very strong pharmaceutical companies. We are watching what they are doing, and we are really open for future collaboration. We believe that we have strong roots and a strong presence in China, but a strong partner can always bring value. This is something we are looking at.

There is one last point that I haven't mentioned. It's about a big program that we began two years ago called the China Initiative for Diabetes Excellence. We established a collaboration with the China Diabetes Society, the Ministry of Health, the CDC and the U.S. IDC, the International Diabetes Center [ (Also see "Sanofi China GM Fabrice Baschiera On Winning The Insulin Battle In China: An Interview With PharmAsia News (Part 2 of 2)" - Scrip, 11 Aug, 2011.)].

The objective is to develop a train-the-trainer program. What we need to do is to help the trainers have better knowledge so that they can train more physicians. We just celebrated the first graduating class two weeks ago in Beijing. This is a very good example of what we call a public-private partnership between an international company, the Chinese government and medical societies, both Chinese and international.

Again, the objective for us is to contribute to medical education. This is a great example of what a leading company can do in China, and only leading companies have the expertise and the legitimacy to do that. This is also a great program that changed the perception of Sanofi in the diabetes segment in China.

I’d like to make one last comment. If you want to be the leader in a country, you can’t look only at type 2 diabetes. You also need to look at the type 1 patients. We are doing a clinical trial now in China, which will help us better understand the disease and how people are treated today, and we are the only one that has a type 1 program in China.

This is differentiating Sanofi from the other companies. If you want to be the leader, you need to have the vision, you need to have the strategy, and of course, you need to have the right products to execute your strategy and fulfill your vision. We have it globally, and we're bringing it to China.

[Editor’s note: Want to know more about how China is changing the global pharma industry? Don’t miss the PharmAsia Summit Shanghai Oct. 21-23, 2013.Click here for more information.]