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As the healthcare industry in Myanmar is growing, the opportunity for over-the-counter (OTC) brands is immense.
Market research agencies believe that the pharmaceutical expenditure in Myanmar will continue to grow at around twelve percent per annum and the market is expected to exceed USD 1.12 billion by 2023. With government measures boosting economic growth, this market is a must for companies wanting to make a difference in Southeast Asia.
Here are four important considerations I believe OTC brands and suppliers must take a closer look at when taking the next steps to entering the Myanmar market.
According to the World Health Organization (WHO), nearly 93 percent of all medical expenses in Myanmar are borne by patients themselves, making it the highest out-of-pocket rate among Southeast Asian countries. The per capita expenditure on medical needs is low, and access to medical care is difficult in rural areas where people must travel long distances to get treatment and medicines.
With a low gross national income per capita, the population is very price-sensitive. Yet with a growing middle-class and a shift in behavior to start “caring for oneself”, there is a clear growth trend.
Product categories offering most growth potential include analgesics as well as vitamins, minerals and supplements (VMS) for both generic and premium OTC brands.
Unlike other markets in Southeast Asia where pharmacies, drugstores and medicine shops are conveniently located in most townships, the number of medicine outlets across Myanmar is very low. More than 60 percent of the market’s total drug sales take place in the two large cities of Yangon and Mandalay. A presence in these major hubs is therefore a must for anyone entering this country.
In the latest research carried out by DKSH and Nicholas Hall on the pharmacy business in Myanmar, it was found that 39 percent of customers enter the pharmacy with a brand prescription, followed by 23 percent with a recommendation from a doctor or hospital for an OTC product.
For both generic OTC and premium OTC products, the doctor’s recommendation is still the key reason for buying an OTC product. However, the report also shows that pharmacists are able to switch the consumer’s choice with their recommendation in approximately 30 percent of cases. Other leading purchasing factors include TV promotion, imported brands and well-known manufacturers.
When entering a new market, it’s essential to understand the marketplace well since you are competing against established brands. Partnering with long-established experts will help you create a clear business strategy and help you effectively expand your business in Myanmar without making mistakes. Local and legal intricacies make it difficult to exit a contract once it is signed, so ensure you shop around for the right partner before locking in your future in this complex country.
While there are various hurdles to overcome, Myanmar’s OTC and pharmaceutical sectors undoubtedly offer many opportunities for healthcare product suppliers and brand owners. With growing public awareness, increased availability as well as further recognition on the benefits for better quality OTC products, the market is expanding and will be one to watch out for in Asia.
Phillip Wray is Vice President Healthcare at DKSH Myanmar. With 25 years of experience in the Asia Pacific healthcare sector, he has a solid understanding of the region’s opportunities and challenges.
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