The global pharmaceutical market in 2010 is expected to grow 4%-6% on a constant-dollar basis, exceeding $825 billion, driven by stronger near-term growth in the US market, according to the latest figures from IMS Health.
Through to 2013, sales are predicted to grow 4%-7% at a compound annual growth rate, taking into account the impact of the global macroeconomy, the changing mix of innovative and mature products, and the rising influence of healthcare access and funding on market demand. Global pharmaceutical market value is expected to expand to $975-plus billion by 2013.
“Overall, market growth is expected to remain at historically low levels, but stronger-than-expected demand in the US is lifting both our short- and longer-term forecasts,” said Murray Aitken, senior vice president, Healthcare Insight, IMS. “In the USA, pricing flexibility and inventory management actions are contributing to much higher growth than anticipated earlier this year, and are the main reasons for the upward adjustment to our five-year forecast.” US market growth in 2009 is now expected to be 4.5%-5.5%, and 3%-5% in 2010.
In contrast, the seven ‘pharmerging’ countries of Brazil, China, India, Mexico, Russia, South Korea and Turkey are expected grow 12%-14% in 2010, and 13%-16% over the next five years. China will lead the pack with 20%-plus growth.
The primary factor limiting global pharmaceutical market growth to the mid-single digits through 2013 is patent loss. During the next five years, products that currently generate an unprecedented $137 billion in sales are expected to face generic competition, including Lipitor, Plavix, and Seretide, and will not be replaced by products with the same magnitude of sales.
In addition, over the next five years, markets will be impacted by numerous cost-containment actions, including the imposition of price cuts on existing drugs, raising the standards required to achieve product reimbursement, and incentivising prescribers and pharmacists to prescribe generic alternatives.
Yet while payers seek to limit price increases and boost the use of lower-cost generics, pharmaceutical manufacturers are expected to maintain their pricing practices, competing on the basis of clinical evidence and value. Current pricing practices by the industry also include the use of off-invoice discounts and rebates, which IMS says are not included in its forecast and reported data, and are understood to be increasing.
A number of events may occur in 2010 that also could have a long-term effect on the pharmaceutical market. These include the potential for passage of comprehensive healthcare reform in the US as well as legislative or regulatory actions in other countries, the magnitude of the H1N1 pandemic, and the timing and extent of the global economic recovery.
