IMS Health Lowers 2009 Global Pharmaceutical Market Forecast to 2.5 – 3.5 Percent Growth
NORWALK, Conn.--(BUSINESS WIRE)--Apr 22, 2009 - IMS Health (NYSE: RX) reported today that the value of the global pharmaceutical market is expected to grow 2.5 - 3.5 percent on a constant-dollar basis in 2009, two percentage points lower than indicated last October, as deterioration in the global economic environment continues to affect market demand. The updated forecast predicts global pharmaceutical sales exceeding $750 billion for the year, down from the $820+ billion forecast in October 2008, reflecting both the lower growth rate and currency exchange fluctuations. The sector will feel the impact of the economic climate -- but to a lesser extent than many other industries -- through 2010, when a rebound is expected. The conclusions are drawn from the latest release of IMS Market Prognosis™, a series of strategic market forecasting publications that incorporate updated macroeconomic indicators provided by the Economist Intelligence Unit.
“To the now-familiar factors impeding market growth such as patent expirations, a slowdown in innovative product launches, and hurdles imposed by payers on market access and acceptance, we can now overlay the economic downturn,” said Murray Aitken, senior vice president, Healthcare Insight, IMS. “There is a clear correlation between demand for medicines and key macroeconomic variables such as GDP, consumer spending and government expenditures. We see the worldwide financial crisis contributing to record-low sales growth this year. The pharmaceutical industry is not recession-proof, but it is insulated to a greater extent than other industries where spending is more discretionary.”
While the pharmaceutical market is expected to rebound as the global economy recovers, an unprecedented level of potential patent expirations in 2011 and 2012 will curb sales growth. The global compound annual growth rate (CAGR) for pharmaceutical market growth is forecast to be 3 - 6 percent through 2013.
In its latest analysis, IMS identifies the following key market dynamics:
“The economic crisis is adding another layer of complexity to an already challenging market environment,” noted Aitken. “To strengthen their resilience, pharmaceutical manufacturers must adapt their strategies and tactics -- re-evaluating their commercial models, pursuing opportunities in emerging markets, and strengthening the value proposition of their medicines in ways that resonate with payers and patients.”
About IMS Market Prognosis
IMS Market Prognosis offerings are subscription-based, strategic market forecasting publications that provide unparalleled insights into the economic and political issues affecting the pharmaceutical and healthcare industries. Based on a rigorous evaluation of the key events affecting the marketplace, IMS Market Prognosis provides a five-year forecast at the country, regional and global level. The scope of coverage includes 42 in-depth country analyses and more than 220 top-line country forecasts in 11 regions worldwide.
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. IMS Market Prognosis forecasts use an econometric model that includes forecasts for economic indicators such as Gross Domestic Product, Consumer Expenditure, and the Consumer Price Index from the Economist Intelligence Unit. As the basis for the forecast model, changes in these indicators will impact forecasted pharmaceutical performance.
Operating in more than 100 countries, IMS Health is the world's leading provider of market intelligence to the pharmaceutical and healthcare industries. With $2.3 billion in 2008 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 product and portfolio management capabilities; commercial effectiveness innovations; managed care and consumer health offerings; and consulting and services solutions that improve productivity and the delivery of quality healthcare worldwide. Additional information is available at http://www.imshealth.com.
Posted: April 2009
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