September 02, 2022

Market Spotlight: Aging populations sparking PMB growth in APAC

Better known as technology giants, Japan’s and South Korea’s reputations as hot regions for pharmaceuticals, medical and biotech (PMB) businesses often flies under the radar. While their PMB proficiency is often overshadowed, it should not be ignored especially as developments in these countries reflects how healthcare could advance across the rest of APAC.

According to Statista, the elderly population (aged 65 and over) of South Korea in 2022 accounts for almost a fifth (17.5%) of the country’s populace. That number is up 0.9 points from last year and has been rising steadily since 2010 (10.8%).

The Japanese government’s statistics are more striking—in 2020, the country had 80,000 centenarians while over-65’s comprised 28.7% of the population.

Simultaneously, the population of Japan is also shrinking overall.

Longer life expectancy and increasing healthcare spending

Taken together, these trends are the consequence of high life expectancies, low fertility rates (1.368 births per woman) and limited immigration. In this context, an aptitude for PMB in these countries is not unsurprising. As populations age, more healthcare spending is required to support them, with companies in the private sector developing innovative and new treatments and therapies that are likely to come at a high cost.

Though immigration to Japan and South Korea is low, foreign buyers are keen to be involved in their PMB sectors. In January, for instance, France-based healthcare giant Sanofi acquired the rights from ABL Bio (South Korea) to develop a drug for treating Parkinson’s and other neurodegenerative diseases. The deal was worth over US$1bn.

Regional opportunities to benefit global healthcare

Western economies are not far behind in terms of these demographic challenges. According to the World Bank, the fertility rate in the European Union has hovered around 1.5 since 2000, and in the US it is trending down, from 2.1 in 2007 to 1.6 in 2020. Even if the US and Europe never produce as many centenarians as Japan, population aging is inevitable.

Between caring for their own elderly and those of the rest of the world, the reputations of Japan and South Korea’s PMB players will only continue to grow in the years to come.

 

Ready for Your Next Deal?

No matter what type of deal is around the corner, make sure you're deal-ready. Use our next-generation data room to deal faster and smarter. Contact your client representative or request a personalized demo.

Get in touch

Dealmaking trends across the world

If you'd like to see how M&A is faring in other sectors and regions, check out our latest Deal Drivers reports from APAC, EMEA, and the Americas to gain more insight into dealmaking.

Learn more

Ready to Get Started?

You may also like:

The ABCs of SPACs and de-SPAC’ed Entities

With the change in market conditions over the last year (increased inflation, interest rates etc.), there is concern that companies who went public via a SPAC in 2020 and 2021 will not be able to continue their business operations due to a lack of free cash flow or will face de-listing because their stock is not in compliance with the NYSE or NASDAQ requirements. These companies may need to explore alternative options, such as rescue capital raises, full company sale to a strategic, bankruptcy, and PE take-private options, etc.

M&A Professionals work on a data room
M&A and digital transformation: Opportunities and challenges in APAC

The pandemic saw a growth spurt in digital platforms. Will the tech sector be able to sustain investor interest in the face of challenging macroeconomic dynamics? Learn more about emerging digital transformation stories from APAC in our expert spotlight blog.

City Skyline
Q4 Reflections: Learning the lessons of a turbulent 2022

With the economy wavering under the strain of inflation, supply chain problems, and the Great Resignation, dealmakers are gearing up for a challenging 2023. Datasite gathered a panel of experts to review what we’ve learned over the past year and what we can do to prepare for the changes ahead.

M & A Professional Looking Out Office Window