Germany Pharmaceuticals and Healthcare Report Q3 2009

Germany's drug market expenditure reached a value of EUR40.6bn (US$59.7bn) in 2008. The value of the country's pharmaceutical market is forecast to reach EUR48.6bn (US$61.6bn) by 2013, representing a compound annual growth rate (CAGR) of 3.69% in local currency terms.

Germany places 2nd in our Western Europe Pharmaceutical Business Environment Rankings for Q309 and is ranked as the 4th most attractive pharmaceutical market in global terms. However, BMI believes Germany may fall in the world rankings in the future, as large high-growth emerging markets - such as Brazil and China - become more alluring to multinational drugmakers.

Germany is present on the Pharmaceutical Research and Manufacturers of America (PhRMA)'s Special 301 Submission 2009, owing to its negative pricing and reimbursement regime, which constitutes a 'significant barrier to imported innovative pharmaceuticals.' The report highlights the negative impact of the country's jumbo reference pricing groups and also criticises restrictive prescription limitations, closely monitored physician drug budgets, and strict prohibitions on the marketing and advertising of innovative medicines.

Despite the financial crisis, the German biotech sector grew moderately in 2008. Turnover was recorded at above EUR2bn (+9%) and expenditure for R&D rose above EUR1bn (+1.1%). Although the number of biotech companies, remained constant at 501, there was a slight increase in the number of employees. The figures were obtained by the information platform biotechnologie.de on behalf of the Federal Ministry of Education and Research (BMBF).

Furthermore, in March, Merck Serono launched a new venture capital fund that will support emerging biotech firms that focus on the multinational's core therapeutic areas, in particular autoimmune and inflammatory diseases, neurodegenerative conditions, oncology, endocrinology and fertility. The pharmaceutical company aims to invest up to EUR40mn (US$54mn) via Merck Serono Ventures during the next five years.

Germany's largest health insurer, Allgemeine Ortskrankenkasse (AOK), has nearly completed its Europe-wide generic drug procurement tender, and has now awarded tenders for 49 of the 63 drugs for which it is seeking suppliers. The new procurement contracts will begin on June 1 2009 and run through 2010. AOK is still to decide on suppliers for a further 14 compounds.

Dr Reddy's Betapharm, Sanofi's Winthrop Sandoz's A1 Pharma, Stada's Aluid, Neuraxpharm, Lindopharm, Apogepha, Heumann, Schwarz Pharma, Mylan Dura, AAA Pharma, Basics, Biocon's Axcount, Teva and Actavis are among the drugmakers who have won tenders to provide AOK with medicines.