"The ultimate revolution for our industry will be the shift from a product-centric business model to solutions that blend products and services tailored to precise needs."

Stefano Collatina


November 18, 2021

Can you provide an overview of Baxter’s main activities and offering in Italy?

Baxter is a differentiated healthcare solutions provider, with an offer of pharmaceuticals, med-tech, and services. In Italy, we have a commercial unit based in Rome, as well as four production facilities. One of our main focuses is renal care, as leaders in dialysis for both chronic and acute patients; we also have a notable presence in clinical nutrition, and we have a dedicated surgery unit, with a suite of innovative solutions for hemostasis and tissue sealing. Finally, we have a large unit for injectables and a comprehensive drug delivery systems portfolio.

What are the most recent innovations at Baxter?

Baxter has just introduced a new individualized care system for the monitoring of critically ill patients called “PrisMax,” through which organ support therapies are delivered continuously to patients in the ICU.  In the area of individualized fluid management, we are also launching Starling – a non-invasive fluid management monitoring system through which IV fluids are dosed based on patients’ response; this technology allows doctors to greatly reduce the risks of adverse effects and optimize the therapy. Another important innovation is Baxter’s recently launched indirect calorimeter (heat measurer) called Q-NRG, used to measure resting energy expenditure (REE) in spontaneously breathing and ventilated patients; Q-NRG will also contribute to more personalized therapy.

Do you think Italy’s lower-than-average pricing can deter drug launches in the country?

The Italian reimbursement system can deter innovators from launching their products in the country, though this varies on a case-by-case basis. Average Italian prices are indeed lower compared to other countries; also, the Italian system is more complicated because in countries like the UK or Germany there is a faster approval pathway and no negotiation. If a satisfactory price agreement for a highly innovative drug cannot be reached with AIFA, the product may well not end up on the Italian market.

At a European level, the referencing system allows all regulatory agencies to access prices in different countries. Multinationals will take this into account, starting their product launches from countries with higher prices and move down to the cheaper ones. This logic can lead to delays in Italy and act as a barrier to innovative drugs.

A different case applies to hospital tenders, where prices are established not via negotiation, but as a result of direct competition. The Italian tender mechanism is more effective compared to other countries, which results in lower prices. For generics specifically, both pricing and reimbursement are faster. Paradoxically, Italy is the largest generics market by value, but we have the lowest prices. Unsustainable in the domestic market, Italian generics leveraged export markets. Once again, this can lead to domestic product shortages, even if Italian-based plants works at capacity.

Another factor affecting drug pricing is the claw-back mechanism, through which the government puts a cap on expenditure; when this is exceeded, the involved parties need to pay back a percentage of that expense difference. Retail and hospital products have different budgets, as there are also separate budgets for oncology, innovation, or orphan drugs. While the retail sector ends up on a surplus, hospitals run into deficits, so companies are requested to pay back the extra spending. This is a hidden discount, ruled a few years ago as an emergency, but which continues to encumber the system. Every year, pharma companies active in the hospital space must accrue the extra money to cover the hidden discount, which makes planning very challenging.

Overall, lower prices lead to lower margins and, therefore, higher entry barriers. While prices stay resolutely low, costs are increasing, compressing profitability and the industry’s long-term sustainability.

What do you see as some long-term implications of the pandemic on healthcare?

At Baxter, we experienced a significant increase in activities related to acute kidney injuries, with at least a quarter of Covid-19 patients in the ICU suffering from this condition. Related to higher hospitalization for Covid-19, we also noted an increase in clinical nutrition. On the other hand, non-Covid therapies saw a decline, the pandemic causing a delay in the diagnosis and treatment of cancer patients and impacting the volume of elective surgeries.

In the long-term, I do not believe we will return to a pre-Covid status-quo. The pandemic proved that people can interact virtually, and this will encourage remote medicine management, telemedicine, and home therapies. The pandemic also showed how little understanding we have of infections and their severity, and I anticipate people will treat hospitals - which are hotbeds for viruses and bacteria - as units of care for emergency and acute cases only. Meanwhile, chronic patients will seek out-of-hospital care. Finally, the ultimate revolution for our industry will be the shift from a product-centric business model to solutions that blend products and services tailored to precise needs. Baxter already benefits from a competitive advantage in this aspect, because, unlike other vertical organizations who rely on third parties, we have in-house capabilities.

What are Baxter’s short-to-medium-term objectives?

Our most immediate goal is to overcome the pandemic. Clinical nutrition remains a priority, accentuated by the pandemic. Another central priority is to assist as many patients as possible outside the hospital through our well-established patient support program, which has been in place for many decades in the areas of peritoneal dialysis and home parenteral nutrition.


"Zambia is ready for business, and as part of our goal to reach 3 million t/y of copper production, there have been some important announcements recently."
"By investing in smart technologies and systems, Henkel Thailand is leveraging digitalization and Industry 4.0 technologies to strengthen its manufacturing excellence."
"We want to invest in infrastructure and local talent, making sure that the resources bring real benefits to the local communities."
"Leading mining companies are transitioning from trucks to conveyor belt systems that are managed remotely from control centers, requiring minimal human oversight."


APLA Latin American Logistics Meeting Review

Despite the challenges, Latin America has several opportunities: Its green energy mix paves the way for the energy transition. In this journey, the chemical and petrochemical industries will be critical, leveraging emerging technologies like AI to enhance their operations.



"Zambia is ready for business, and as part of our goal to reach 3 million t/y of copper production, there have been some important announcements recently."