Senior health a priority for Megalabs

Megalabs has secured a US$70mn, 10-year loan from IDB Invest for expansion in eight regional markets including Argentina, Chile, Colombia, Ecuador and Peru. The company, which will particularly prioritise expanding production of essential medicines for the elderly, plans to launch 140 products by 2026. 

Comment from CHC Insight Latin America Editor, Jen Jones: As elsewhere, LatAm’s population is ageing rapidly and Megalabs highlighted UN figures showing that 145mn Latin Americans will fall into the 65+ years age bracket by 2030, equivalent to almost a fifth of the population. Among other regional marketers responding to this trend is Brazil’s Hypera Pharma, which indicated in 2022 that the senior demographic was key to its long-term, sustainable growth strategy.

According to the UN, the number of people aged 65+ for every 100 people aged 18-64 (known as the old-age dependency ratio) is set to grow from 13 in 2015 in Latin America & the Caribbean and Asia, to 20 in 2030. All other regions, with the exception of Africa, are showing a similar trend.

Source: United Nations, World Population Prospects

Nicholas Hall Writes: Our lead story this week is part of a rush of stories that proves our industry is at last beginning to take demographic marketing seriously. After years of speculation about its consumer and commercial benefits, we seem to mean what we say: that the consumer is at the centre of our industry and identifying the needs of small and not-so-small cohorts is very important. The number of babies being born each year is declining, which has massive implications in terms of population balance. It also presents a huge opportunity as consumers, we are told, are prepared to spend a significant amount on the Little Emperors and Empresses. Except it’s an urban myth, and we just don’t see dynamic growth in the paediatric sector.

The same is true of products for the elderly, which everyone knows is the fastest-growing population group, and by no means the poorest people, but often the ones with the highest disposable income. And yet we see so few brands that meet the needs not of geriatrics but of the active elderly. Here is not the place to restate in detail that there is not one cohort of older consumers, but at least three main groups: Working Seniors, The Active Retired and The Inactive Retired (and often terminally ill). I’ve written previously about the medical needs and high consumption of healthcare products among these groups, and about the mixed messages of extending the number of years lived but not the quality of life. This will be an important component of our New Paradigms 2023 report, which is subtitled “The Future Resumed”, and which will contribute to our Strategic Narrative for 2023. We will be discussing this in more detail at the London Conference in April, but it’s no secret that – having accurately predicted the likely growth rate in 2022, which was amazingly upbeat – our future forecasts will be more moderate.

Nicholas will explore key trends impacting the CHC landscape in the upcoming new edition of his signature New Paradigms report. Providing an essential strategic review of the industry, for more information when it becomes available, please contact melissa.lee@NicholasHall.com.

CDC Report Shows Further Falls In US Life Expectancy

Life expectancy in USA has fallen for the second consecutive year, according to provisional data published by the US Centers for Disease Control & Prevention. For 2021, US life expectancy at birth was 76.1 years, the lowest since 1996 and down from 77.0 years in 2020. Male (73.2 years) and female (79.1) life expectancy also declined to levels not seen since 1996.

The almost one-year decline between 2020-21 was primarily owing to increases in mortality because of Covid-19 (50% of the negative contribution), unintentional injuries, heart disease, chronic liver disease & cirrhosis and suicide. This would have been greater were it not for the offsetting effects of decreases in mortality owing to influenza & pneumonia, chronic lower respiratory diseases, Alzheimer’s & Parkinson’s disease and perinatal conditions.

Nicholas Hall Writes: Does falling life expectancy matter? Yes, it matters a lot, to individuals and their friends and families; and to society, especially as some of the early deaths are among members of the economically-active population who financially support both the younger and older age groups. It also matters to our industry in that it continues to change the demographics, which may present new marketing opportunities.

As is his wont, tech billionaire Elon Musk has repeated his warning of a global underpopulation crisis, most recently tweeting that “population collapse due to low birth rates is a much bigger risk to civilisation than global warming”. Experts disagree. Demographer Joseph Chamie hit back: “He’s better off making cars … than at predicting the trajectory of the population. Yes, [in] some countries, their population is declining, but for the world, that’s just not the case.” This is backed by the UN’s World Population Prospects 2022 report, as we reported back when it was first published in July, which predicts that on 15th November 2022 the global population will reach 8bn and that it could grow to around 8.5bn in 2030 and 9.7bn in 2050, before peaking at around 10.4bn people during the 2080s.

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