Global pharma market will grow by 5% in 2009: IMS Health

IMS Health has forecasted a 4.5% to 5.5% growth in the global pharmaceutical market during 2009, with dollar amounts exceeding $820 billion.

In the US, the pharma market is predicted to grow by 1% to 2%—$287 billion to $297 billion—slightly less than the 2% or 3% rate previously expected, according to IMS Health's 2009 Global Market Forecast, published today.

So-called “pharmerging markets”, such as China, Brazil, India, South Korea, Mexico, Turkey and Russia, are predicted to show the most growth next year, with numbers reaching $105 to $115 billion combined, or 14% to 15%, according to the data.

Among therapeutic classes, oncologics is expected to grow the most, by 15% to 16% [$48-$52 billion] in 2009, followed by HIV Antivirals at 13% to 14% [$9-$13 billion], and narcotic analgesics, at 12% to 13% [$8-$12 billion].

In other findings, IMS projected only 25 to 30 new chemical entities slated for launch in 2009. Four or five of those products, in the areas of acute coronary syndrome, diabetes, rheumatoid arthritis and meningitis, could turn out to be blockbusters, the report speculated.

“Pharmaceutical growth next near will hold stead at 2008 levels,” said Murray Aitken, senior vice president, healthcare insight, IMS, in a statement. “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.”

IMS Forecasts Global Pharmaceutical Market Growth of 4 - 6% in 2010; Predicts 4 - 7% Expansion Through 2013

IMS Health (NYSE: RX) reported today that the value of the global pharmaceutical market in 2010 is expected to grow 4 - 6 percent on a constant-dollar basis, exceeding $825 billion, driven by stronger near-term growth in the U.S. market. The forecast, the leading annual industry indicator of market dynamics, predicts global pharmaceutical market sales to grow at a 4 - 7 percent compound annual growth rate through 2013, and takes 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+ billion by 2013.

In its latest forecast, the company raised its expectations for five-year pharmaceutical market growth by one percentage point, partly due to the stronger demand being experienced in 2009. The conclusions are drawn from the latest release of IMS Market Prognosis™, the company’s series of strategic market forecasting publications.

“Overall, market growth is expected to remain at historically low levels, but stronger-than-expected demand in the U.S. is lifting both our short- and longer-term forecasts,” said Murray Aitken, senior vice president, Healthcare Insight, IMS. “The economic climate will continue to be a dampening influence in most mature markets, particularly in those countries with rising budget deficits and publicly funded healthcare systems. In the U.S., 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.”

In its latest analysis, IMS identifies the following key market dynamics:

• Growth prospects in the U.S. market improve. Near-term growth prospects in the U.S. have strengthened in recent months, reflecting both sustained levels of price increases and changing inventory stocking patterns. Pharmacy chains are more tightly managing their inventory levels based on expectations of patient demand, which has led to greater purchasing volatility than in previous years. This also has played a role in unusually high sales growth in the first quarter of 2009 relative to forecast expectations. U.S. market growth in 2009 is now expected to be 4.5 - 5.5 percent, and 3 - 5 percent in 2010. 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 are not reflected in IMS’s forecast and reported data, and are understood to be increasing.
• Economic downturn affects markets to varying degrees. Growth has slowed in countries where there is high out-of-pocket spending on pharmaceuticals and steep declines in macroeconomic activity, especially in Russia, Mexico and South Korea. At the same time, growth has been less affected to date in countries where drugs are largely funded publicly, such as in Germany, Japan and Spain. However, new cost-containment measures expected to be introduced during the forecast period likely will impact the pace of growth in these markets. In the U.S., pharmaceutical manufacturers’ efforts to expand access to and awareness of patient assistance programs, as well as co-pay subsidies for patients in need, are limiting the impact of the economic downturn to some extent.
• Impact of the innovation/patent loss imbalance dampens growth prospects. Consistent with trends of the past several years, the next five are expected to reflect a significant imbalance between new product introductions and patent losses. This is the primary factor limiting global pharmaceutical market growth to the mid-single digits through 2013. 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®. At the same time, new products that will enable innovative approaches for treating patients suffering from diseases such as osteoporosis, respiratory ailments, thrombosis, multiple sclerosis and cancer are not expected to generate the same magnitude of sales as products losing patent protection.
• Pharmerging markets in aggregate sustain strong growth. Despite economic conditions significantly affecting some markets – notably Russia, Turkey, South Korea and Mexico – the seven pharmerging countries are expected in aggregate to grow by 12 - 14 percent in 2010, and 13 - 16 percent over the next five years. China’s pharmaceutical market is expected to continue to grow at a 20+ percent pace annually, and contribute 21 percent of overall global growth through 2013. Russia and Turkey may be impacted significantly by new measures intended to reduce the level of healthcare spending in those two markets.
• Healthcare access and funding under intensifying pressure. The economic climate has heightened concerns by payers about healthcare funding, and intensified their efforts to limit access to non-generic drugs. During the next five years, markets will be impacted by numerous payer actions, including the imposition of price cuts on existing drugs, the raising of standards required to achieve reimbursement of innovative therapies, and the use of economic incentives for prescribers and pharmacists to drive a shift to generic alternatives. Evidence of the value that medicines bring to healthcare systems will be required to achieve access and funding in both developed and emerging markets.

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 U.S. 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.

“While our outlook for the global market is more positive than earlier in the year, the fundamental dynamics of the innovation cycle, funding pressures, and the broader macroeconomic environment will result in mid-single-digit growth over the next five years,” noted Aitken. “Notwithstanding the improved prospects in the U.S. market, the drive by pharmaceutical manufacturers to adapt to the longer-term marketplace trends and evolving patient needs will continue undiminished.”

IPA to conduct panel discussion on 'how to handle expired drugs' next month

Wednesday, April 21, 2010 08:00 IST
Peethaambaran Kunnathoor, Chennai

In the wake of the present expired drugs scam that plagued the entire pharma industry in Tamil Nadu, the Industry Division of the Indian Pharmaceutical Association plans to conduct a Panel Discussion on ‘How to Handle the Expired Drugs’. The programme will be conducted in Chennai in the first week of next month.

Apart from experts in the industry, the discussion will be attended senior officials from the departments of drugs control and pollution control board from southern states of the country, said J Jayaseelan, secretary of the Industrial Division, IPA.

Jayaseelan was elected to the post of Secretary to Industry Division in the national executive committee meeting held in Mumbai on last Saturday. Dr Kaushik Desai is the new president of the Division.

“We want to educate the public as well as the people in the industry and the trade. Even the manufacturers are not fully aware of the latest technology emerging in the industry. There are so many ways to handle the expired drugs. The recent issue has maligned the dignity of the industry and we are trying it not to recur. The manufacturers and the management of the industrial firms have to be trained and updated with the latest developments happening in the technology,” Jayaseelan said.

Prior to the experts’ discussion, there will be a symposium on the same subject where in representatives from pharma industries, wholesale distributors, retailers, faculties from pharmacy colleges and regulatory staffs will participate.

Since the subject has relevance at present, the participants can suggest ways and measures on how to handle the technology in the industry and how to recall the date expired drugs from circulation for destruction. Further to this, IPA will conduct training classes for people engaged in the drug business about the various methods of handling drugs and destruction of the date expired.

According to Jayaseelan, the secondary aim of conducting the symposium and the upcoming training classes is to educate the small and medium scale manufacturers.

In Tamil Nadu more than 400 SME units are functioning, but they are unable to train themselves or their staffs on the various methods of technology, not only for destruction purposes, but also for development of new drugs. So these initiatives of the IPA will help them attain knowledge based resources to benefit their business also. IPA will start such programs in other states too shortly, he said.