Industry Trend Analysis - SSN Pharmaceutical Spending To Remain At A Low - DEC 2017

BMI View : The Italian government ' s debt burden will continue to impact the country ' s pharmaceutical sector - a large beneficiary of public funds. The government remains committed to remaining under the EU's stipulated 3% of GDP budget deficit limit, and will use any additional fiscal capacity to ease the tax burden instead of ramping up spending. As a result SSN spending will remain constricted, intensifying revenue pressures for drugmakers and pharmacies in Italy, as well as increasing out-of-pocket costs for the population.

Aligning with our long-term view of a difficult operating environment for drugmakers in Italy, prescription drugmakers operating in the country will continue to face revenue challenges as spending by the country's national healthcare service, Servizio Sanitario Nazionale (SSN), continues to be restricted. The prescription drugs sector will experience a five-year compound annual growth rate of 1.3% in local currency terms (+2.4%% in US dollar terms), to EUR28.86bn (USD33.76bn) in 2021, up from EUR27.08bn (USD29.96bn) in 2016. However, data published by Federfarma, the Association of Italian Pharmacists, highlights that SSN spending levels will remain constricted, remaining well below historic highs.

Prescription Drugmaker Revenues Constrained

Expenditure Remains Low
SSN Pharmaceutical Expenditure
Source: Federfarma, BMI

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