The number of high-growth pharmaceutical markets ranked as “pharmerging” has now risen from seven to 17, and their sales will expand in aggregate by $90 billion during 2009-13, contributing 48% of annual market growth in 2013 compared to 37% in 2009, says market research firm IMS.

There is now an unprecedented shift of industry growth to the world’s emerging economies, says IMS. “With a raft of pharmerging countries rapidly gaining market share, we’re seeing a new world order take hold within the pharmaceutical industry,” said Murray Aitken, senior vice president, Healthcare Insight, at the firm. “It’s clearer than ever that the China market is in a league of its own, while an expanding group of fast followers are building momentum and providing additional growth opportunities. These are all diverse markets with their own unique health care funding, delivery and distribution characteristics. But collectively, they offer strong growth prospects fueled by rising Gross Domestic Product (GDP), expanding access to healthcare and, in many cases, an improving regulatory environment.”

In contrast, key dynamics that continue to contribute to lower sales growth in mature pharmaceutical markets include high rates of patent expiration, increased market penetration of generics, underfunding of the biotech industry, changes in reimbursement and tighter government restrictions around product safety and spending, as well as macroeconomic conditions, says the report.

In 2006, IMS identified seven pharmerging markets – China, Brazil, Mexico, India, Russia, South Korea and Turkey. In its latest study, the firm identifies three levels of such markets - Tier I of which consists solely of China.

With GDP of more than $8 trillion, China is poised to become the world’s third-largest pharmaceutical market next year, up from eighth place in 2006, and will contribute additional $40 billion-plus annual sales by 2013, IMS forecasts. Most growth in China will continue to come from branded generics manufactured and marketed by established domestic companies, although demand for innovative products from multinational companies is rising in the country’s leading urban centers, it notes.

The Tier II pharmerging markets are Brazil, Russia and India, which are each expected to add $5-$15 billion in annual pharmaceutical sales by 2013. Brazil and Russia have both achieved consistent double-digit pharmaceutical sales growth in recent years, while India has benefited from a rising middle-class population, improvements in medical infrastructure and the establishment of intellectual property rights, says the report.

Finally, Tier III consists of what IMS terms the “fast followers” - an additional 13 countries which are now expected to contribute $1-$5 billion each in annual sales growth by 2013. They are: Venezuela, Poland, Argentina, Turkey, Mexico, Vietnam, South Africa, Thailand, Indonesia, Romania, Egypt, Pakistan and the Ukraine. While each market is unique, they are all complex, dynamic and subject to rapid change, according to the study.

“The key essentials are in place for the industry to drive new opportunities within each tier of the pharmerging markets,” said David Campbell, senior principal, Pharmerging Markets at IMS. “Pharmaceutical manufacturers that lead in building out organizational competencies, tailoring portfolios and adapting business models to these new markets will reap the benefits of differentiation and entrenched presence compared to those that wait,” he advised.