Industry Trend Analysis - Regulatory Challenges To Restrict Drugmaker Revenue Streams - FEB 2018

BMI View : Drugmakers operating in Latin America's pharmaceutical markets a re poised for a challenging 2018 . Ongoing economic crises and government focus on the containment of infectious diseases , in addition to regulatory, pricing and reimbursement challenges, will create a difficult operating landscape. While the overall picture that emerges is not positive, the region's long-standing liberalisation efforts, strong consumer demand and uptake of biosimilars make the region a lucrative investment prospect for drugmakers.

The Latin American USD57.5bn (EUR52.0bn) drug market (excluding Venezuela) is forecast to expand to USD80.8bn (EUR69.0bn) with a 7.1% CAGR at CER through to 2021. The Latin American pharmaceutical market will post a five-year CAGR of 7.0% in USD terms and 5.8% in EUR terms. The Latin American region is made up of the Mercosur, Southern Cone, Andean and Central America sub-regions. The USD25.9bn (EUR23.4bn) Mercosur region will post a 9.4% CAGR at CER through to 2021. The USD9.5bn (EUR8.6bn) Southern Cone region will post a 12.0% CAGR at CER through to 2021. The USD7.2bn (EUR6.5bn) Andean region will post a 5.8% CAGR at CER through to 2021. The USD14.0bn (EUR12.6bn) Central American region will post a 5.3% CAGR at CER through to 2021. Meanwhile, the USD7.0bn (EUR6.3bn) Caribbean region will post a 3.3% CAGR at CER through to 2021.

Government focus on improving industry regulations and increasing access to healthcare services, in addition to a growing chronic disease burden and rising population disease awareness, will continue to be the key driving forces for Latin American pharmaceutical market growth. However, poor reimbursement policies, ongoing intellectual property concerns and drug approval delays will hinder investment returns. Additionally, as a number of economies across the region continue to face headwinds, we are likely to see increasing downward price pressure on medicines as a result of the austerity measures placed on the healthcare sector in the short term.

Pharmaceutical market Forecast
e/f = BMI estimate/forecast. Source: BMI

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