The Market for Pharmaceuticals in Brazil, Russia, India & China 2009

Evaluate the status, opportunities and threats for pharmaceutical companies in Brazil, Russia, India and China now and in the future. Market forecasts to 2014 are provided, plus free quarterly-updated reports on each country, keeping you up to date with developments for a full year.

Many are concerned that a potential global economic downturn could blunt the rapid growth in the BRIC countries. Is this a time of exciting opportunity or commercial danger for pharmaceutical manufacturers? This report separates the fact from the fiction and is essential in making sound, impartial business judgements.

This insightful report provides:

• 5-year forecasts to 2014 and market valuations for each market
• A detailed analysis of the health structure, funding, service and outlook
• Quarterly updated reports of key developments in the market

These leading emerging and rapidly-growing economies represented a total market of 2.76 billion people and a combined GDP of US$6.1 trillion in 2007. But where do commercial opportunities exist for pharmaceutical companies now, and what are the future prospects?

Putting things in perspective

The BRIC countries' pharmaceutical markets are currently valued at US$54.9 billion. This is a large sum of money, but is collectively lower than found in leading markets such as the USA and Japan. Growth rates, ranging from 5% in Brazil to 15% in Russia are impressive, but the low starting point - along with a range of other operational issues - means companies must be targeted in the opportunities they pursue.

Opportunities do exist

There are, of course, wide regional differences in expenditure levels within the BRIC countries, far more so than in developed countries where health systems have evolved to provide a more uniform level of coverage. All four countries have a relatively wealthy urban population with a far greater spending power than their respective national average. In the case of China and India, these urban populations have grown rapidly, and number hundreds of millions. The challenge for these countries is to extend this level of wealth to the rest of the population, in order that better levels of healthcare become affordable.

A long haul

This is evolution not revolution, and change will be incremental. Short-term opportunities exist in meeting the health demands of the burgeoning middle classes, and future prospects are bright, where steady growth in BRIC markets will erode commercial differences with the established markets in North America, Japan and Europe.

Current and accurate decision support information is vital

Effective planning is vital and that is why Espicom, the leading provider of pharmaceutical market intelligence, has issued this report collection The Market for Pharmaceuticals in Brazil, Russia, India & China 2008. For each country there is a comprehensive examination of the market for pharmaceuticals which covers all aspects of the operating environment from the regulatory situation through health provision/expenditure to domestic production. Importantly, each market evaluation includes 5-year growth forecasts and SWOT analysis. An additional benefit - at no extra cost - is that concise quarterly-updated outlook reports are included in the price.

HIGHLIGHTS FROM THE REPORT...

BRAZIL

Due to the depreciation of the US dollar, the Brazilian pharmaceutical market is experiencing high growth in dollar values. The Brazilian pharmacy sector was valued at US$9.8 billion in 2006, well ahead of the pharmacy sector in Mexico, valued at US$9.6 billion. Drug prices continue to increase in spite of generics competition. Excluding ICMS and other taxes applicable to drugs, FEBRAFARMA estimated the annual pharmaceutical market at US$10.9 billion and 1.7 billion units in 2006. Including ICMS and other taxes, Espicom estimates the market to reach around US$13.6 billion in 2007, equal to US$72 per capita.

The generics sector is dominated by local producers, restricting the market entry for foreign producers. In 2006, generics sales amounted to US$1.1 billion, equal to 10.7% of the overall pharmacy sector. Generics sales will continue to outperform the pharmacy sector, fuelled by generics production of oral contraceptives & hormones and blockbusters losing their patents.

RUSSIA

In 2008, the Russian market for pharmaceuticals was estimated at US$11,128 million. Per capita spending is low, at US$78. It is expected that the pharmaceutical market will continue to expand at a rate of 17.0% per annum, taking it to US$21,878 million by 2013, or US$157 per capita.

Around 74% of the market is supplied by imports. Germany and France were the leading suppliers in 2006, accounting for over 30% of imports. The value of imports reached US$6.1 billion in 2006, an increase of 43.4% over 2005. Many importers are CEE generic companies such as Gedeon Richter, Krka and Lek.

INDIA

India has a huge population in excess of one billion people and a growing middle class with access to high quality healthcare. Conversely, in this geographically vast country plagued by natural disasters, the majority of the population is both rural and poor and western style pharmaceuticals are not even an issue for millions of people.

India has an established domestic industry, responsible for around 8% of world pharmaceutical production. The larger domestic companies are striving to compete in the global market for both generics and original products. The market is dominated by low priced, domestically-produced generics and relatively low per capita expenditure on pharmaceuticals.

The introduction of patent protection for pharmaceutical products from 1st January 2005 makes India a more attractive proposition for the international research-based industry, albeit in a highly competitive market. The highly skilled domestic workforce offers good opportunities for outsourcing both research and production.

CHINA

China, in terms of both its healthcare system and medical device market, is a nation of contradiction. As the world's most populous country, and one in possession of the fastest growing major economy in the world, the nation offers a vast array of opportunities for overseas investors, complemented by a massive potential workforce and consumer base. The SARS (severe acute respiratory syndrome) crisis of 2003 forced the government to examine the Chinese health infrastructure in great detail and healthcare has become a priority of the present government.

Other priorities addressed by the government include the standard of rural healthcare which for many years has differed markedly in its quality to that in urban areas. In particular, the more basic practices of 'barefoot doctors' are being phased out, and medical personnel in these impoverished regions are now required to pass a more advanced series of qualifications in order to be recognised by the government. Increased investment from overseas in the form of a range of projects continues, and the HIV/AIDS epidemic in China has assumed greater significance, with the establishment of various programmes aimed at attempting to combat the disease.