Biotech Values

[DewDiligence]

Roche enters the health-insurance business in China (sort of):

http://www.bloomberg.com/news/2012-11-13/roche-propels-cancer-drug-sales-in-china-with-insurance.html

Roche Holding AG has found a way to sell cancer drugs to millions in China who couldn’t otherwise afford them: first sell them insurance.

The world’s biggest maker of tumor medicines is getting together with reinsurer Swiss Re to sell a Swiss-engineered private insurance that’s on track to garner 10 million clients this year…

…Roche…provides health data needed to set up the policies. Swiss Re…does the statistical heavy lifting and then re-insures local insurers who sell the policies.

…“The old theory was that there are only two segments: the rich, who can afford it, and the poor who cannot afford it at all,” [Severin] Schwan [Roche CEO] said in the interview in Paris. “Now what you have is an emerging middle class…able to make a contribution.”

The cost of the insurance can range from about $50 a year for a basic product to several thousand dollars for the most complete coverage…

…Roche and Swiss Re first dreamed up the program in 2010. International companies aren’t allowed to sell retail insurance in China, Schwan said, though they can provide re-insurance. So Roche’s Swiss partner had to approach local first-line insurers in China to get the program started.

Cancer is a growing problem in China. More than a quarter of the country’s deaths are due to malignancies, and the rate is expected to rise for the next 10 to 25 years, said Qiao Youlin, director of the Department of Cancer Epidemiology at the Cancer Institute in Beijing.

…The two companies may introduce the concept elsewhere in Asia, according to Robert Wiest, head of the reinsurer’s China unit. Thailand and Indonesia are possible markets…

(This article is from Nov 2012.)

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