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Market |
Healthcare and Medical |
Report Type |
Market Research |
Country |
United Kingdom |
Published |
6 January 2010 |
Number of Pages |
99 |
Download |
|
Immediate |
|
Publisher |
Business Monitor International |
In the Business Environment Ratings for Q110, the UK continued to improve its matrix position, and is now ranked fourth of the nine Western European markets surveyed. The new ratings criteria serve to reinforce our estimation of the country’s potential due to a stronger emphasis on the regulatory environment, which we see as a major factor affecting the business environment for drugmakers. However, the country’s strict pricing and reimbursement regimes, coupled with the effects of the economic downturn, an active switching regime and the upcoming patent cliff, are expected to result in declining pharmaceutical values over the next five years. Having been worth GPB18.8bn (US$34.9bn) in 2008, in the 2009-20014 period, the market is forecast to post a compound annual growth rate (CAGR) of -0.41% to reach GBP19.1bn (US$33.6bn).
The authorities have also recently addressed reimbursement levels for Category M products (reimbursable generics), as pharmacies are thought to be becoming too adept at negotiating prices with wholesalers. In fact, in September 2009, the category M tariff was reduced by an average of GBP0.09 (US$0.15) per item, as a result of a government survey revealing that contractors had achieved ‘significant excess’ profit, which falls beyond the agreed GBP500mn (US$817mn) in 2008-2009. The changes are expected to achieve savings of approximately GBP20-25mn (US$33-41mn) over Q409.
In the meantime, the pressure is also mounting in the country’s pharmaceutical distribution industry. In October 2009, Belgian drugmaker UCB announced a change to the distribution of its medicines in the UK, having appointed only three (vertically integrated) companies – AAH Pharmaceuticals, Alliance Healthcare and Phoenix Healthcare – for the job. While UCB has followed the lead set by Pfizer in 2007, which cuts out the middlemen, allows the drugmakers to set their own pharmacy discount levels and reduces competition by limiting the number of wholesalers dealing in certain products, UK pharmacists warned of drug shortages. Although the blame for stock problems with more than 50 branded medicines is mostly apportioned to an attractive export market and quotas set by drugmakers, moves towards direct-to-pharmacy (DPT) distribution are also causing problems.
On the other hand, new product launches and an ageing population should ensure the growth of individual therapeutic categories. In fact, in October 2009, the UK joined other European countries in rolling out a mass vaccination programme against H1N1 (A) influenza (swine flu). The nationwide vaccination programme commenced on October 21 2009, with front-line health workers and hospital patients – who are believed to be at high risk – immunised with the vaccine. Around the same time, Alliance Boots launched a nationwide scheme under which it is providing vaccinations for women against the two forms of the human papillomavirus (HPV) responsible for 70% of cervical cancer cases.
Healthcare and Medical Company Profiles contain up to date financial, strategic, operational, SWOT analysis and product information on the activities of thousands of healthcare and medical companies.
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