Industry Trend Analysis - Drug Pricing Strategies A Driver Of Market Outlook - JAN 2018

BMI View: Medicine prices will continue to drive the pace of growth of the Asia Pacific region's pharmaceutical market. Pricing pressures in both emerging and well-developed markets in the region will grow as governments seek to balance the heightening demand of medicines while containing costs. Drug pricing policy will remain a key determinant of revenue generation potential for new medicines and as such commercial rewards for multinational drugmakers in the region will be significantly affected by the aggressive pricing regimes.

Pharmaceutical price control will remain a persistent threat to the pharmaceutical sector's growth trajectory in the Asia Pacific (APAC) region. Rising medicine expenditure in both developed and less-developed markets within the region, attributable to ageing populations and the growing prevalence of chronic diseases, will continue to create financial pressures for cash-strapped governments. As a result, in order to create cost savings while maintaining continued access to therapeutics, a growing number of countries in the region are pushing for the implementation of aggressive pricing regimes. These will in turn pose revenue earning challenges for innovative drugmakers and we forecast APAC's pharmaceutical market to expand from USD303.9bn in 2016 to USD375.1bn with a 6.0% CAGR at constant exchange rates through to 2021.

A Diverse Region

Price Control Threatens Long-Term Growth Outlook
Asia Pacific: Pharmaceutical Sales (USDbn)
f= BMI forecast. Source: BMI

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