Diasorin, CEO Carlo Rosa: diagnostics are strategic to defeat antibiotic resistance
[ad_1]
«In diagnostics, America is the reference market, China is the next big market. We have to be there», says Carlo Rosa, the managing director of DiaSorin, the Italian multinational in the sector which is expanding in both. It has recently digested the largest acquisition in the medical sector of an Italian company on the American market, Luminex, for 1.8 billion dollars, and from 2024 it will start production in the recently completed plant in China, where it has invested 40 million euros . When we speak with Carlo Rosa, the prediction of the Chinese expert Zhong Nanshan has been circulated for a few hours according to which in China there is an increase in cases of Covid infections which leads us to expect about 40 million cases a week by the end of May. peaking at 65 million by the end of June.
Doctor Rosa, in the geography of diagnostics what is the weight of the different countries and what dynamics are you facing, after you have been on the shields throughout the Covid and post-Covid period?
From the outset, China decided to tackle the pandemic on its own: it has not approved a single Western product. For Western companies, the Chinese market has not been an opportunity for development and today the combination of Fortress America and geopolitical tension has meant that a project called China Medtech, which aimed to produce 50% of Medtech in the country, has undergone a strong acceleration and that what in the future has the potential to be the largest market is today more closed than in 2019.
Is China in the direction of your growth? How are you investing in the country?
In China, the strategy is to localize, also pursuing the direction of the Chinese government which envisages the production in China of products for the local market. In 2019 we started building a plant in which we invested 40 million euros and which will be operational from next year, with a joint venture in which the government is also a partner. In 2024 it will go into production and we will make 2 product lines for oncological diagnostics and thyroid dysfunction.
How important is the presence of the Chinese government in the joint venture?
He is a minority shareholder but he is very important because it allows us to understand well the developments of a market which is a great opportunity: the country today invests 4% of its GDP in health care, but there is an enormous slice of the population that must access it and health care costs grow by 15% per year. Within the next 10 years, China will become the largest market for diagnostics to be there for, manufacturing and developing products in China, in a company considered of strategic value to China.
Entering the American market for an Italian company is a great challenge, especially in the scientific and technological fields, given the primacy that the country has. What role does the United States play in diagnostics and your growth?
The American diagnostic market is worth 40% of the world market. The United States spends 16% of GDP on health care. The OECD average is 7-8%. China spends 4%, but increases health spending by 15% a year. If we reflect on what Covid has left us, we must certainly speak of an acceleration of China’s technological independence. From the point of view of Europe, it has left little: since there is in fact no European health policy, everything has been delegated to the countries, the pandemic has exacerbated a critical situation in the various health systems, there has been no structural resolution of the problems. In the United States, however, the Barda (Biomedical advanced research and development authority), which is responsible for innovative technologies, has made 20 billion dollars available to support their development, to be used after this pandemic to face the next one. The strategy is to have the ability to test peripherally without having to go to the hospital. We have been selected as a strategic company, we have received funding of 30 million dollars which go to support the development of a new diagnostic system for making molecular swabs in 15 minutes in which we have invested 100 million.
We live in a phase in which pharmaceuticals have had to address the shortage of some antibiotics in our country, but not only. The misuse of antibiotics and their consequent loss of effectiveness is a major issue for global health systems. How can diagnostics help?
I’m coming from Linate, where, leaving the airport, I came across a huge billboard that talks about viruses and bacteria in the form of cartoon characters and transfers in a very popular way one of the great themes of the future, the antibiotic resistance on which the Diagnostic companies can help health systems a lot. We have collaborated with MeMed to create a test that in 20 minutes understands if a patient presenting with a respiratory tract infection has a viral problem, in which case the antibiotic is not needed, or a bacterial one, in which case it is needed. Today there is an immoderate use of antibiotics: between Europe and the United States there are 80,000 deaths due to antibiotic resistance. In Europe there are 30,000 deaths, of which 11,000 are in Italy and this is the result of decades in which the antibiotic was given without major controls. WHO forecasts between now and 2050 are 10 million deaths a year worldwide from this cause, with an exponential progression. The bet, what you have to do, is to be able to establish very quickly whether the infection is bacterial or viral.
What would there be to “import” from the American market?
The United States is the most important market, the one that pays the best thanks to a high price structure that has a strong impact on profitability, highly values innovation and has a clear and fast approval process. This makes the American market highly appealing. But it is a difficult market because it is very fragmented: in America there are 7,000 hospitals (in Italy there are 700), where all the big names in diagnostics play their game. We have been in America for 30 years, but to be competitive we had to have a different presence, which arrived with the acquisition of Luminex. Today over half of Diasorin’s turnover is in the United States (in 2022 it was 1.3 billion, up 10% on 2021, with an Ebit of 417 million euros), as well as the employees who work in the 6 production sites in the United States they are half of the 3,300 total. It is a relevant geography, the rest of the turnover is distributed between Europe and China.
[ad_2]
Source link
