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.
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.
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.