Industry Trend Analysis - Healthcare Providers To Benefit From Ageing Populations - MAR 2018


BMI View : Ageing populations across the Europe region will bolster drugmaker revenue earning opportunities through the increased demand for chronic disease medicines. However, increasingly aggressive cost-containment measures are likely to be imposed by governments due to greater scrut in y over healthcare spending. These trends will be mo st keenly felt in Western European markets , and increasingly in Central European markets. The rapid expansion of access to healthcare in emerging Europe markets will drive significant growth.

Europe's USD1,849bn (EUR1,672bn) healthcare market is forecast to post a 3.6% compound annual growth rate (CAGR) at constant exchange rate (CER) terms through to 2021. The USD243bn (EUR219bn) emerging Europe region will post a CAGR of 7.7% through to 2021. In contrast, the USD1,607bn (EUR1,452bn) Western Europe region will post a 3.0% CAGR through to 2021. Europe's healthcare market will post a five-year CAGR of 4.5% in USD terms and 3.3% in EUR terms.

Healthcare Expenditure Forecast
2012-2026
f = BMI forecast. Source: World Health Organization (WHO), BMI

The predominant drivers of increasing healthcare expenditure are the region's growing pensionable population and government focus on reducing inequality in healthcare provision. The demographic profile of the European population will drive the rising incidence of chronic conditions, in particular cardiovascular diseases and cancers. This trend will be particularly prominent in the Western European markets as populations have a strong bias towards branded drugs; however, in these markets, cost containment remains high on the agenda of governments and efficiency measures will weigh on market growth. Opportunities therefore exist in emerging Europe as initiatives to expand access to services will drive the expansion of healthcare markets.

Regional Healthcare Expenditure Trends, Historical Data And Forecasts (Europe (Region) 2013-2021)
2013 2014 2015 2016 2017f 2018f 2019f 2020f 2021f
f = BMI forecast. Source: World Health Organization (WHO), BMI
Health spending, USDbn 2,138.754 2,163.706 1,850.484 1,849.377 1,937.010 1,963.735 2,109.504 2,218.918 2,304.968
Health spending, USDbn, % y-o-y 4.82 1.17 -14.48 -0.06 4.74 1.38 7.42 5.19 3.88
Health spending, USD per capita 2,385.1 2,404.9 2,050.0 2,042.2 2,132.2 2,155.1 2,308.8 2,422.8 2,510.3
Health spending, % of GDP 9.23 9.22 9.18 9.44 9.66 9.57 9.96 10.03 10.01