Industry Trend Analysis - Strong Regional Economic Growth Will Support Drugmaker Investment Returns - MAR 2018

BMI View: The improving economic outlook and policies aimed at economic reforms in the Asia Pacific (APAC) region will introduce increasing opportunities for investment recorded by healthcare providers and drugmakers. Moreover, the region's traditional commitment to healthcare, increasing public provision of medical services and the greater emphasis on improving the operating environment means that, over the long-term, there will be significant commercial opportunities for multinational pharmaceutical companies to exploit.

The improving macroeconomic situation in the Asia Pacific (APAC) region will ensure that the pharmaceutical landscape remains highly lucrative for multinational drugmakers and local firms. According to BMI's Country Risk team's analysis, the APAC region expanded by an average of about 4.5% in 2017 and will continue to be the top performing region in terms of growth over the next two to three years. This growth picture will continue to be driven by key dynamics, which includes robust macroeconomic fundamentals, policies aimed at economic reforms, trade integration as well as strong demographics. We note that increased economic activity is likely to have knock-on effects on pharmaceutical market growth and has the potential to create major tailwinds for drugmakers, both in terms of the attractiveness of the operating environment and medicine demand. Moreover, the region's improving business environment will attract significant investments over the long-term, which is likely to boost pharmaceutical self-reliance.

Pharmaceutical Outlook

Asia Will Remain The Top Growth Region
Growth Rate (2017, 2017-2019 Average)
Source: BMI

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