Clinical Trials in Latin AmericaA Region of Diversity, A World of Opportunity

2 I Clinical Trials in Latin America

Latin America: A Region of Diversity, a World of Opportunity for Clinical Trial Sponsors

Latin America is hardly the latest new region to be discovered for conducting pharmaceutical clinical trials; global pharmaceutical companies have been running clinical trials in Latin America for over 20 years. Nonetheless, the region is noteworthy because it is still an attractive location for clinical research— and in many ways more conducive to studies than ever before. The more than 20 countries that make up Latin America offer a vast pool of subjects for trials and patients for marketed drugs. Approximately 600 million people live in the region, which stretches from Mexico in the North to Chile and Argentina in the South. Indeed, the combined populations of just three countries, Brazil (192 million), Mexico (103 million), and Argentina (41 million), surpass the U.S. population. Sponsor companies that are sensitive to the differences in demographics and regulations from one country to the next will find that Latin America is ripe with opportunities for clinical research. The benefits—most especially easy access a diverse patient population—outweigh the challenges of obtaining regulatory approval.The following pages highlight some of the characteristics of Latin America as a whole that are relevant for companies interested in launching studies in the region. While detailed country-specific information is required to determine which countries would be most appropriate for any given study, this overview serves as a good foundation on which to build a deeper exploration.

The World’s Most Ethnically Diverse Region The countries that comprise Latin America all share a Latin ancestral influence and speak either Spanish or Portuguese. The region, which covers roughly 13 million square miles, is one of the most ethnically diverse on the planet. Within Latin America, there are Native Americans or Amerindians, the region’s indigenous people; Blacks; Mulattos; Mestizos (those of mixed European and Amerindian ancestry); and Caucasians, although the composition varies from country to country. (See Figure 1) Native Americans represent 8% of the overall population, but represent a majority in Bolivia and constitute sizeable minorities in Ecuador, Guatemala, and Peru. Caucasians predominate in Argentina, Uruguay, and Puerto Rico. Brazil is made up of a high percentage of mixed Black and Caucasian (or Mulatto) people. The remaining countries have high, but varying, percentages of Native Americans, and mixed races. Consequently, the culture of each country is quite unique.

Figure 1: Population Makeup (%) in Key Latin American Countries

Ethnicity Argentina Brazil Chile Colombia Ecuador Guatemala Mexico Peru

White 97 47.7 52.7 20 6.1 9 15

Mestizo 44 58 71.9 60 60 37

Mixed 2.5 43.1 14 7.4

Black 7.6 4 7.2

Amerindian 0.5 2.5 4 7 40 30 45

Other 0.5 1.1 0.8 0.4 1 3

Source: Interethnic ad mixture and the evolution of Latin America populations, 2014

Brazil

Chile

Argentina

Peru

Ecauador

Colombia

Mexico

Guatemala

Cuba

Costa Rica Venezuela

Panama

Dominican Republic

Uruguay

Jamaica

El Salvador

HondorasBelize

Nicaragua

Bolivia

Paraguay

Haiti

Bahamas

Trinidad & Tobago

3

This racial diversity is an important factor to consider in country/site selection for studies in which the incidence of disease is significantly higher in a particular group.

The region has experienced the same phenomenon as the rest of the world in terms of an increase in life expectancy. Thanks to improved sanitation, public health programs, better nutrition, economic development and medical advances (particularly those that significantly reduced infant mortality), Latin Americans are living longer, and the elderly portion of the population is increasing. The Population Reference Bureau reports that those 65 and older already represent 10% of Argentina, Cuba, and Uruguay, and this will be the case in most Latin American countries by 2030.1

As in other areas of the world, there has also been an epidemiological transition: the prevalence and incidence of communicable diseases have been decreasing while the prevalence and incidence of “lifestyle” disease have been rising at an alarming rate. Urbanization, a sedentary lifestyle, smoking, and a diet rich in fats and carbohydrates is contributing to cardiovascular disease, obesity, diabetes mellitus and chronic kidney disease. Thus, Latin America’s pattern of disease is beginning to mirror that of the U.S. and EU countries.

Currently, almost half of all mortalities in the region are due to just ten causes, seven of which are chronic diseases. (See Figure 2)

The population across the region is so diverse that it is relatively easy to find patients that meet certain inclusion/exclusion criteria for study—whether the protocol specifies that patients be treatment naïve or that they have already been exposed to a certain therapy. The population is broad enough, too, that it is often possible to find patients suffering from rare conditions.

4 I Clinical Trials in Latin America

1 Lee, Marlene and Scommegna, Paola, “Aging in Latin America and the Caribbean,” The Population Reference Bureau, April, 2014.

Figure 2: Leading Causes of Mortality

Leading Cause of Mortality Percentage

Ischemic Heart Disease 9.21

Cerebrovascular Disease 7.70

Diabetes Mellitus 6.54

Influenza and Pneumonia 4.54

Cardiac Insufficiency 3.56

Assaults Resulting in Homicide 3.45

Hypertensive Disease 3.45

Chronic Diseases of the Lower Respiratory Tracts 3.30

Cirrhosis and Other Diseases of the Liver 3.06

Motor Vehicle Accidents 3.02

Clinical Trials in Latin America I 5

Wide Societal Variances Just as Latin American countries are heterogeneous when it comes to demographics, living conditions are also quite different across the region. The average years of education completed is often low (7.3 years in Colombia, 8.9 years in Mexico, 9.3 years in Argentina, 9.5 years in Ecuador, and 9.7 years in Chile). However, it is 14 years in Peru. This is a factor that must be taken into consideration when preparing materials for patients; information must be presented so that it can be understood by people with all education levels. As the Economic Commission for Latin American and the Caribbean has reported, economic welfare is different by country, and often there are wide discrepancies between urban and rural areas. The percentage of the population whose basic needs remain unmet can range from 5% to 35%. “Housing conditions and access to basic services (drinking water, sanitation, and electric power) are far more of a problem in rural areas, and the public investment required to improve them is substantially higher because of the wide geographical dispersion of households or their remoteness from public or private service networks.”2

The Most Urbanized Area of the WorldLatin America is home to dense urban areas; in fact, the United Nations has referred to it as the most urbanized region of the world.3 Overall, 80% of Latin Americans live in cities, and the urbanization process is expected to continue. The United Nations estimates that by 2020, 90% of the people in the Southern Cone region will live in cities. Many of the major cities date back to the efforts of Europeans to colonize the area in the 16th century. Sao Paulo (20 million), Mexico City (19 million), Buenos Aires (13.6 million) and Rio de Janeiro (12 million) all rank in the top 25 largest metropolitan centers in the world.4

As shown in Figure 3, the population distribution across urban areas in Latin America closely resembles that of Asia. Latin America also has more people living in “megacities” than North America.

2 “Millennium development goals: progress towards the right to health in Latin America and the Caribbean,” Economic Commission for Latin American and the Caribbean, August2008.

3 Colombia Reports, United Nations, August 21, 2012. 4 WorldAtlas, based on 2012 Census.

Figure 3: Urbanization by Region

Europe Africa Asia Oceania Northern America

Latin America and the Caribean

10090

80

706050

403020

100Sh

are

of U

rban

Pop

ulat

ion

(per

cen

t) Megacities of 10 million or more

Large cities of 5 to 10 million

Medium-sized cities of 1 to 5 million

Cities of 500,000 to 1 million

Urban areas smaller than 500,000

Source: World Urbanization Prospects: The 2014 Revision, Highlights

Population distribution by city size varies across major areas in 2014

A Strong and Modern Healthcare SystemThroughout the Latin American region where access to care is constitutionally guaranteed, expenditures on healthcare have been rising steadily—in many cases, faster than in the global market as a whole. (See Figure 4) Latin American governments have made expanded and improved healthcare a priority even in the face of budget constraints. A rising middle class with demands for high quality care are giving rise to a private healthcare sector.

The availability of healthcare resources varies dramatically from country to country, as evidenced by Figures 5 and 6. Interestingly, the number of hospital beds per capita in Argentina and Brazil is even higher than in North America. As of 2010, three countries in the region (Uruguay, Argentina, and Chile) had surpassed the Pan American Health Organization Goal of having 25 healthcare workers (physicians, nurses, and dentists) per 10,000 people. (By way of comparison, the U.S. has 25.9 physicians, 110.7 nurses, and 6.2 dentists per 10,000 people.5)

6 I Clinical Trials in Latin America

Figure 4: Healthcare Expenditure per Capita 2009-2012

4000

3500

3000

2500

2000

1500

1000

500

0

US

Dol

lars

Per

Cap

ita

-1.0

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

3340

618337

1030

530723

995 1056 1103 Perc

ent o

f Cha

nge

0.9 1.01.2

1.7 1.8

2.7

3.23.4

EU Mexico Peru World Colombia Panama Argentina Brazil Chile

1 “Health Situation in the Americas: 20 Years Basic Indicators,” 2014.

Source: http://data.worldbank.org/indicator/SH.XPD.PCAP/countries/1W?display=graph

Clinical Trials in Latin America I 7

Figure 5: Number of Hospital Beds per 1,000 Population, by Country

Figure 6: Healthcare Workers per 10,000 Population

HondurasNicaraguaGuatemalaBoliviaVenezuela

BelizeCosta RicaEl SalvadorUruguayParaguayEcuadorPeru

MexicoChilePanamaUnited StatesCanadaBrazilArgentina

0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0

Source: Pan American Health Organization.

Source: Pan American Health Organization, Human Resources Project, Measurement of Goals, 2010.

70

60

50

40

30

20

10

0

59.0

37.032.7

23.8 22.519.5 17.4

8.9

25.0

Uruguay Argentina Chile Colombia Paraguay Peru Ecuador Bolivia Goal

High Quality Standards and Training in Western MedicineLatin America offers a supply of highly trained physicians and well-equipped sites for conducting clinical trials. Most physicians in the region have completed their postgraduate studies and specialty qualifications in the U.S. or EU, and medical training standards are high. Clinical study professionals are part of a respected community that exchanges clinical and scientific expertise. And, experience has shown that investigator sites reliably provide high-quality data in the required timeframe.

Generally, physicians are eager to participate in clinical trials because the opportunity brings medical advances to their patients, offers professional prestige, and is a supplemental source of income.

All Latin American countries have adopted the International Conference for Harmonization (ICH) Good Clinical Practice (GCP) guidelines, and the area boasts several laboratories that have been certified by the College of American Pathologists (14 in Brazil, 10 in Mexico, and 4 in Argentina). The local Ethics Committees and Ministries of Health conduct routine audits of facilities.

Audits performed by the U.S. Food and Drug Administration (FDA) confirm that quality standards are high. Out of 10 global regions, Latin America has the second highest percentage of inspections with no action indicated (NAI). (See Figure 7)

8 I Clinical Trials in Latin America

Figure 7: FDA Inspections 2005-March 2014

Region Countries Included (excluding countries with no inspections)

Inspections Since 2005

No Action

Required

Voluntary Action

Indicated

Official Action

Indicated

CIS Georgia, Russia, Ukraine 102 70.6% 28.4% 1.0%

Latin America Argentina, Brazil, Chile, Colombia, Costa Rica, Ecuador, Guatemala, Mexico, Peru 100 61.0% 38.0% 1.0%

India India 44 59.1% 40.9% 0.0%

CEEBulgaria, Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Serbia, Slovakia

166 54.2% 45.2% 0.6%

Western EuropeAustria, Belgium, Denmark, Finland, France, Germany, Italy, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, United Kingdom

242 50.8% 48.3% 0.8%

United States United States 2099 49.5% 43.7% 6.7%

Asia Pacific Hong Kong, Malaysia, Philippines, South Korea, Taiwan, Thailand 48 47.9% 52.1% 0.0%

China China 19 42.1% 57.9% 0.0%

Source: http://www.fda.gov/downloads/Drugs/InformationOnDrugs/UCM111343.zip (Accessed March 17, 2014)

Strict Regulatory GuidelinesThe regulations governing trial applications and approval are, of course, somewhat different within each individual Latin American nation. In general, however, each country requires approval by the regulatory authority, the Ministry of Health (MoH) and the appropriate Ethics Committee. The approval process can be lengthy—and perhaps more important—somewhat hard to predict, despite published target approval timelines. These can range from an average of 20 weeks in Peru to an average of 40 weeks in Brazil. (See Figure 8) In all cases, the bulk of the time is taken up by the MoH.

Clinical Trials in Latin America I 9

Figure 8: Average Regulatory Turnaround Times By Country

Source: Clinical Trials and Tribulations in Latin America)

ArgentinaBrazil

ChileColombiaMexico

Peru

0 5 10 15 20 25 30 35 40 45

Regulatory Timeline (weeks/calendar)

Argentina Brazil Chile Colombia Mexico Peru

Ethics Committee 0 9 13 3 5 5

Ministry of Health 19 26 6.5 13 13 10

Impact License 1 4 1 4 2 3.5

An Active, But Far From Saturated, Trial MarketIn terms of its capacity to accommodate clinical trials, Latin America is, potentially, at an ideal stage: it has the requisite staff, facilities, regulations and quality standards, but is not yet saturated with trials. Currently there are 1,427 active industry studies in progress across ten countries in the region, and six countries (Brazil, Mexico, Argentina, Chile, Peru and Colombia) account for nearly 90% of all Latin American trials. (See Figures 9 and 10) Brazil, in fact, accounts for nearly one-third of all trials in the region, which is not surprising given the size of Brazil’s pharmaceutical market. IMS Health has forecasted that Brazil will be the 4th largest pharmaceutical market in the world by 2017.

10 I Clinical Trials in Latin America

Figure 9: Registered Studies in Latin America1000

800

600

400

200

0Brazil Argentina Mexico Colombia Chile Peru Guatemala Panama Domincan

RepublicEcuador

125

878

333297 289

160127 102

45 41 19 14

138

347

134

388

61

192

59

179

40

122

1655

1654

10 22 4 20

New Registry in 2013

Active

Active Industry

Source: clinicaltrials.gov Oct 13, 2014

Clinical Trials in Latin America I 11

Rank Country No. of Trials Percentage % Cumulative

1 Brazil 1,928 30.4 30.4

2 Mexico 1,244 19.6 50.0

3 Argentina 1,042 16.4 66.5

4 Chile 569 9.0 75.4

5 Peru 483 7.6 83.0

6 Colombia 379 6.0 89.0

7 Guatemala 123 1.9 91.0

8 Costa Rica 112 1.8 92.7

9 Venezuela 106 1.7 94.4

10 Panama 91 1.4 95.8

11 Ecuador 53 0.8 96.7

12 Dominican Republic 52 0.8 97.5

13 Cuba 32 0.5 98.0

14 Uruguay 26 0.4 98.4

15 Jamaica 15 0.2 98.6

16 El Salvador 14 0.2 98.9

17 Honduras 14 0.2 99.1

18 Bolivia 13 0.2 99.3

19 Haiti 12 0.2 99.5

20 Bahamas 11 0.2 99.7

21 Paraguay 7 0.1 99.8

22 Nicaragua 6 0.1 99.9

23 Belize 5 0.1 99.9

24 Trinidad & Tobago 4 0.1 100.0

Total 6,341 100% -

Figure 10: Cumulative Number of Trials, By Country

Source: National Institutes of Health (NIH) - Sep 2010

12 I Clinical Trials in Latin America

Figure 11: Concentration of Studies by Market Size

Figure 12: Breakdown by Study Phase

As shown in Figure 11, Chile actually has the highest concentration of trials given its population.

Nearly two-thirds of clinical studies in the region are Phase III trials, with only 2.4% being Phase I trials. (See Figure 12)

Country Population(*) No. of Trials No. of Trials/ 10,000 People

Brazil 193,785 1,928 0.10

Mexico 109,586 1,244 0.11

Argentina 40,341 1,042 0.26

Chile 16,970 569 0.34

Peru 26,163 483 0.17

Colombia 45,660 379 0.08

Source: National Institutes of Health (NIH) - Sep 2010Economic Commission for Latin America and The Caribbean (CEPAL in Spanish)Internet Media Services (IMS)(*) Data of Population and Sales correspond to Year 2009

Source: National Institutes of Health (NIH) - Sep 2010Economic Commission for Latin America and The Caribbean (CEPAL in Spanish)Internet Media Services (IMS)

Phase I

Phase II

Phase III

Phase IV

Other

Brazil Mexico Argentina Chile Peru Colombia

Perc

enta

ge

0

10

20

30

40

50

60

70

3.7 2.1 1.8 1.6 1.4 0.8

15.119.4 20.4 20.6 22.6

14.2

53.8 56.4

64.167.3 64.8

68.1

19.212.9

9.0 7.7 7.212.1

8.1 9.34.6 2.8 3.9 4.7

Clinical Trials in Latin America I 13

International pharmaceutical companies are responsible for seven out of ten clinical trials (on average) across the region. In Brazil, a high percentage of trials (42%) are carried out by universities, public institutions, academic centers, and other independent researchers. (See Figure 13)

Figure 13: Breakdown by Type of Sponsor

Source: National Institutes of Health (NIH) - Sep 2010Economic Commission for Latin America and The Caribbean (CEPAL in Spanish)Internet Media Services (IMS)

The Accessibility FactorIf the benefits of conducting clinical trials in Latin American had to be summed up in one word, that word might be accessability—accessability that stems from the continent being in the Southern Hemisphere and from the easy access to a suitable and willing patient population within an advanced medical infrastructure. And, of course, accessability translates into cost savings.

A long list of advantages to performing clinical research in Latin American countries includes:

• Season inversion from the Northern Hemisphere. By extending studies into Latin America, sponsor companies can pursue year-round research on conditions that are tied to seasons (such as pneumonia, the flu, and allergies for example). The ability to conduct studies in Latin America also gives companies a contingency plan, since enrollment success can first be accessed in studies in the Northern Hemisphere.

• A diverse patient population. The wide diversity of races and ethnicities in Latin America mirrors that in the wider market. Patients can be found to fit a broad array of inclusion and exclusion criteria.

• Easy access to patients. The fact that most Latin Americans live within large urban areas means that recruitment efforts can be concentrated and that trial logistics simplified. This is, in fact, a major source of cost savings.

• Willing and compliant patients. Latin Americans are, generally, eager to participate in clinical trials when their physicians recommend doing so. The strong physician/patient bond that exists in the region also strengthens patients’ compliance and retention in the trial.

Phase I

Phase II

Phase III

Phase IV

Other

Brazil Mexico Argentina Chile Peru Colombia

Perc

enta

ge

0

20

40

80

100

Global Pharma

CROs

Independent

National Pharma

Other

51.0

0.1

42.1

1.75.1

81.2

0

13.3

0.74.8

88.2

0 0 000 0 007.7

4.1

81.9

16.3

1.8

70.2

22.6

7.2

80.5

15.8

3.7

14 I Clinical Trials in Latin America

• An Enthusiastic and Qualified Investigator Community. Physicians in Latin America are trained in the highest medical standards and appreciate the opportunity to enroll their patients in studies that involve the latest treatment advances. Participation in studies also brings physicians and medical centers a degree professional prestige and a welcome source of additional income.

• Adherence to ICH GCPs. Latin American governments have been consistently promoting regulations that adhere to legal and ethical international standards, and facilities are routinely audited for compliance.

• Minimal Translation Costs. Although the clinical community is typically fluent in English, all study materials must be produced in the local language: either Spanish or Portuguese. So, there are only two basic languages to accommodate, although extra care must be taken to reflect any local nuances from one country to the next—most particularly in the wording of Informed Consent Forms for patients.

• Substantial Markets for Product Sales. The approximately 600 million people of Latin America represent a sizeable market for approved drugs. IMS Health has estimated that the region will generate 10% of global pharmaceutical sales by 2017.

• Proximity to North America. The continent’s time zones are convenient for interactions with headquarter offices of North American R&D companies.

• Proven Quality. Refer to FDA inspection data in Figure 7.

Challenges To Bear In Mind The diversity that characterizes Latin America is certainly one of its major strengths when it comes to the region’s suitability for clinical trials. There is, however, a flip side to that which sponsor companies should bear in mind: each country in the region naturally has its own set of regulations, cultures, and conventions. This necessitates that companies work with partners well established in each country who have an understanding of the local procedures, an expansive professional network, and a strong relationship with the country’s MoH.

Conclusion

Latin America is perhaps at an ideal stage in its development as a clinical trial location. The region is far from saturated with trials, yet has the regulatory framework and clinical infrastructure to support high-quality research. Sponsor companies would do well to consider the possibilities that Latin America represents and seek more detailed information as part of their study planning process.

Pharm-Olam International 450 North Sam Houston Parkway E., Suite 250 Houston, TX 77060 T: 713.559.7900 F: 713.559.7901

Pharm-Olam International (UK) The Brackens, London Road Ascot, Berkshire, SL5 8BJ, UK T: +44 (0) 1344 891121 F: +44 (0) 1344 890335

www.pharm-olam.com

About Pharm-Olam International

Pharm-Olam International is a global contract research company with a presence in over 40 countries, offering a wide range of comprehensive clinical research services to the pharmaceutical, biotechnology, and medical device industries.

For more information on planning successful trials in Latin America and around the world, contact info@pharm-olam.com.