IMS Health Forecasts 4.5 - 5.5 Percent Growth for Global Pharmaceutical Market in 2009, Exceeding $820 Billion

    Key Dynamics Shaping Market:

    --  Robust, double-digit growth in 'pharmerging' markets

    --  Increased focus on specialty-driven therapies

    --  Leveling of U.S. growth at 1 - 2 percent

    --  Worldwide economic volatility

NORWALK, Conn.--(BUSINESS WIRE)--Oct. 29, 2008--The global pharmaceutical market is expected to grow 4.5 - 5.5 percent next year, a pace similar to 2008, according to the IMS Global Pharmaceutical and Therapy Forecast(TM) released today by IMS Health (NYSE: RX). The forecast, the leading annual industry indicator of market dynamics and therapy performance, predicts global pharmaceutical sales to surpass $820 billion in 2009, reflecting sustained double-digit growth in key emerging countries tempered by a slower pace in more established markets. This includes the U.S., where growth is expected to be in the 1 - 2 percent range for both 2008 and 2009.

"In many respects, 2009 will reflect the new shape of the global pharmaceutical market, the result of market factors that have gained momentum over the past several years," said Murray Aitken, senior vice president, Healthcare Insight, IMS. "Pharmaceutical growth next year will hold steady at 2008 levels. The market will continue to contend with a number of forces - among them, the shift in growth from developed countries to emerging ones, specialist-driven products playing a larger role, blockbuster drugs losing patent protection, and the rising influence of regulators and payers on healthcare decisions. Layered on top is the uncertainty in the global economic environment and its effect on demand."

In its 2009 forecast, IMS identifies the following key market dynamics:

    --  Slowing Growth in Mature Markets. This year, the U.S.
        pharmaceutical market, the world's largest, is forecast to
        grow 1 - 2 percent to $287 - $297 billion, down from the 2 - 3
        percent rate expected earlier this year. Contributing to the
        slower growth is less-than-expected demand for recently
        introduced products, as well as the economic climate, which
        appears to be having an impact on doctor visits and
        pharmaceutical sales.

    In 2009, the expected 1 - 2 percent growth rate in the U.S. will
    result in sales of $292 - $302 billion, and reflects the impact of
    continuing patent expirations, fewer new product launches and a
    tighter economy. The top five E.U. countries (France, Germany,
    Italy, Spain and the United Kingdom) are forecast to grow 3 - 4
    percent next year, reaching sales of $162 - $172 billion. In
    Europe, growth driven by the continued aging of the region's
    population and rising demand for preventive care will be tempered
    by the increased impact of health technology assessments, the use
    of contracting by payers as a means to control costs, and the
    decentralization of government healthcare budgets. Japan, the
    world's second-largest market, is expected to see higher growth of
    4 - 5 percent, reaching $84 - $88 billion. Approvals of new
    anti-cancer agents, disease prevention programs, and the absence
    of the Japan government's biennial price cuts all will contribute
    to stronger growth. Government efforts to promote the use of
    generics will have only a modest impact on the Japan market in
    2009.

    --  Rapid Expansion of "Pharmerging" Markets. The pharmerging
        markets of China, Brazil, India, South Korea, Mexico, Turkey
        and Russia are forecast to grow at a combined 14 - 15 percent
        pace to $105 - $115 billion. Along with the pharmaceutical
        industry's increased focus on these high-growth markets, these
        countries are benefiting from greater government spending on
        healthcare and broader public and private healthcare funding -
        which is driving greater access to, and demand for, innovative
        medicines.

    --  An Emphasis on Specialist-Driven Markets. Products mainly
        prescribed by specialists are forecast to grow 8 - 9 percent
        in 2009 and are expected to contribute 67 percent of total
        market growth. Biologics are forecast to grow at an 11 - 12
        percent pace, while oncology products will achieve 15 - 16
        percent growth, and HIV therapies 13 - 14 percent growth. In
        contrast, products generally prescribed by primary care
        physicians are expected to grow 2 - 3 percent, due to the loss
        of patent exclusivity for several blockbusters and fewer
        significant product launches.

    --  Fewer Products Winning Regulatory Approval. New product
        approvals remain at historically low levels, with only 25 to
        30 new chemical entities slated for launch in 2009. In
        addition, many of these are specialist-driven and niche
        products with relatively limited market potential. Expected
        launches for 2009 include four or five potential blockbusters
        for treating acute coronary syndrome, diabetes, rheumatoid
        arthritis and meningitis.

    --  An Economic Slowdown, Most Pronounced in the U.S. Economic
        conditions will be a complicating factor impacting the
        worldwide pharmaceutical market in 2009. In the U.S., the
        correlation between economic factors and pharmaceutical growth
        is stronger in the current slowdown than in previous
        downturns, given the continued shift of drug-related costs to
        patients. IMS estimates that in 2009, the downturn will
        effectively reduce growth in the U.S. by 2 - 3 percentage
        points. Other markets with large out-of-pocket spending
        requirements - including Brazil, India and Russia - also are
        likely to be affected by economic changes.

    --  Generics Market Continues to Evolve. An additional $24 billion
        of branded products, including anti-epileptics, proton pump
        inhibitors and anti-virals, will lose their market exclusivity
        in the top eight markets in 2009. This will contribute to
        generics sales of more than $68 billion next year, and a 5 - 7
        percent growth rate - similar to 2008 and lower than the
        levels experienced in 2006 and 2007. The decline is being
        driven by growth slowdowns in the U.S. and U.K., where many
        competitors in large therapy areas are creating a fierce price
        war and cutting margins for generics manufacturers. Other
        countries are striving to increase the use of generics through
        various government efforts.

    --  Intensified Involvement of Payers and Health Technology
        Assessors. In 2009, growth across the leading European markets
        will be affected by payer actions, which include increased
        rebating and contracting in Germany, expansion of regional
        formularies in Italy, a five percent decrease in branded
        prices in the U.K., a 10 percent price reduction on a number
        of brands in France, and the expansion of the reference
        pricing system in Spain. Meanwhile, the impact of Heath
        Technology Assessors will be felt in Germany by reimbursement
        limitations for new drugs not determined to be cost effective.
        And in the U.K., the pharmaceutical market may be affected by
        any policy change that allows patients to buy additional
        treatments not offered by the National Health Service.
A number of events may occur in 2009 that also could have a long-term impact on the pharmaceutical market. These include the uptake of biosimilars in human growth hormones and erythropoietins in Europe, the adoption of generics in Japan, the use of contracting strategies across the E.U., the deregulation of the pharmacy sector in Europe, and the potential for healthcare policy changes in the U.S. following the November presidential election.

Added Aitken, "Biopharmaceutical companies can still find avenues of growth by focusing on emerging markets, specialist-driven products and biologics, by uncovering pockets of unmet need and underutilization in primary care markets, by demonstrating the superior value of their medicines, and by re-invigorating their established brands. The growth is not where it used to be, and it may not be as easy to come by, but it is out there. The key to success in this new environment will be in adapting the pharmaceutical industry's commercial models to accommodate these new developments."

About the IMS 2009 Global Pharmaceutical Market and Therapy Forecast

The 2009 forecast of market and therapy performance is based on extensive analyses by IMS consulting and forecasting experts. It uses IMS Market Prognosis, a strategic market forecasting publication, and IMS Therapy Forecaster, a unique forecasting system based on detailed quantitative and qualitative methodologies. Combined, these tools deliver the most accurate and statistically robust insight into pharmaceutical and healthcare trends in the world's largest and most important emerging markets.

The forecasts take full account of key issues impacting the pharmaceutical and healthcare industries. Additional factors that may affect overall growth include major safety events resulting in product withdrawal or prescribing restrictions; shifts in regulatory approval standards from their current levels; the application of sudden cuts to drug spending levels; public health crises; and a deterioration in economic conditions. Growth is measured in constant dollars to avoid the influence of currency exchange rates; sales are calculated at the ex-manufacturer level. Market Prognosis forecasts use an econometric model including forecasts for economic indicators such as Gross Domestic Product (GDP), Consumer Expenditure (CEP), and the Consumer Price Index (CPI) from the Economist Intelligence Unit. As the basis for the forecast model, changes in these indicators will impact forecasted pharmaceutical performance.

About IMS

Operating in more than 100 countries, IMS Health is the world's leading provider of market intelligence to the pharmaceutical and healthcare industries. With $2.2 billion in 2007 revenue and more than 50 years of industry experience, IMS offers leading-edge market intelligence products and services that are integral to clients' day-to-day operations, including portfolio optimization capabilities; launch and brand management solutions; sales force effectiveness innovations; managed care and consumer health offerings; and consulting and services solutions that improve ROI and the delivery of quality healthcare worldwide. Additional information is available at http://www.imshealth.com.


    CONTACT: IMS Health
             Gary Gatyas, 610-834-5338
             ggatyas@us.imshealth.com
             or
             Clive Savage, +44 20 3075 5311
             csavage@uk.imshealth.com
 
 

Posted: October 2008


View comments

Hide
(web4)