Australia Pharmaceuticals & Healthcare Report

Providing expert analysis, independent forecasts and competitive intelligence on the pharmaceuticals and healthcare industry.

Report includes: BMI Industry View, Industry SWOT Analysis, Industry Forecasts, BMI's Pharmaceuticals and Healthcare Risk Reward Index, Market Summary, Economic Forecasts, Company Profiles and Competitive Landscape.

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  • Gain insight on emerging trends that could support, strengthen or disrupt your activities in the market
  • Get a full view of the competitive landscape to assess your market position
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Australia Pharmaceuticals & Healthcare Report
Product Price
$1,295.00

BMI View: Drugmakers operating in Australia will face an increasingly challenging business environment as the Sixth Pharmacy Community Agreement's measures come into effect. This includes a 5% price cut to medicines listed on the F1 formulary for more than five years, as well as changes to the calculation used in the price disclosure cycle. Critically, we highlight that biosimilar substitutability and naming will be a growing area of contention between originator firms and authorities who seek to curtail spending due to the exponential increase in biologics expenditure over the past few years.

Headline Expenditure Projections

  • Pharmaceuticals : AUD14.0bn (USD10.5bn) in 2015 to AUD14.5bn (USD9.6bn) in 2016; +3.4% in local currency terms and -8.6% in US dollar terms, due to significant exchange rate fluctuations.

  • Healthcare: AUD162bn (USD121bn) in 2015 to AUD169bn (USD112bn) in 2016; +4.2% in local currency terms and -7.7% in US dollar terms, due to exchange rate fluctuations.

Headline Pharmaceuticals & Healthcare Forecasts (2014-2020)
2014 2015 2016f 2017f 2018f 2019f 2020f
f = BMI forecast. Source: National Sources, BMI
Pharmaceutical sales, USDbn 12.149 10.504 9.606 9.302 9.932 10.176 10.405
Pharmaceutical sales, % of GDP 0.84 0.84 0.83 0.82 0.80 0.78 0.76
Pharmaceutical sales, % of health expenditure 8.9 8.9 8.9 8.9 8.8 8.7 8.6
Health spending, USDbn 136.845 117.919 107.912 105.037 113.100 117.154 121.412

Risk/Rewards Index

In Q316 Australia remains ranked as the third most attractive market to pharmaceutical investors in the Asia Pacific region (scoring 64.8 out of 100), after Japan (79.4) and South Korea (65.2). Australia's RRI score is driven by a relatively high drug spending per capita (scoring 7.2 out of 12), a large pensionable population (scoring 6.4 out of 8) and robust population growth (scoring 3.5 out of 5), but is dragged down by poor sector growth (sector value growth score of 0 out of 12).

Latest Updates

  • In March 2016, local news sources reported that private health insurance premiums will increase on average by 5.59% from April 1 2016. This is slightly less than the 6.2% hike in 2015 and follows the intervention by Health Minister Sussan Ley asking insurers in January 2016 to lower their premium increases or justify them.

  • That same month, Pfizer announced that it is in the final phase of upgrading its Adelaide facility. According to the firm, this will secure 100 jobs and contribute to global cancer treatment. The plant will in particular be manufacturing pegfilgrastim used to stimulate white blood cells in cancer patients.

  • March also saw Sussan Ley announce 'healthcare homes' or primary healthcare centers to coordinate care packages for patients with multiple chronic illnesses. The cost of healthcare at these centres will be aggregated into quarterly payments on a per visit basis.

BMI Economic View

The RBA kept its cash rate unchanged at 2.00% at its February 2 monetary policy meeting, but continued to leave the door open for further easing. Amid a low inflationary environment and growing downside risks to the Australian economy, particularly from the housing market, we forecast the central bank will reduce its key policy rate by 50bps to 1.50% in 2016, and we expect the AUD to head lower over the coming months, underperforming other commodity currencies.

BMI Political View

The uncertainty in Australia's cost containment policy will continue, posing risks to the pharmaceutical and healthcare industry. Despite the need to control spending, there is a lack of political consensus among the leading political parties in the country on the strategy that should be adopted. This is further compounded by the local interest groups within the healthcare industry, which have been able to shape policy decisions, including the backtracking of a general practitioner co-payment proposal in March 2015.

BMI Industry View
7
Table: Headline Pharmaceuticals & Healthcare Forecasts (2013-2019)
7
SWOT
10
Industry Forecast
12
Pharmaceutical Market Forecast
12
Table: Pharmaceutical Sales, Historical Data And Forecasts (Australia 2011-2019)
15
Healthcare Market Forecast
16
Table: Selected Health Measures In Australia FY2015/16 Budget
17
Table: Healthcare Expenditure Trends, Historical Data And Forecasts (Australia 2011-2019)
19
Table: Government Healthcare Expenditure Trends, Historical Data And Forecasts (Australia 2011-2019)
19
Table: Private Healthcare Expenditure Trends, Historical Data And Forecasts (Australia 2011-2019)
20
Prescription Drug Market Forecast
21
Table: Prescription Drug Market Indicators, Historical Data And Forecasts (Australia 2011-2019)
23
Patented Drug Market Forecast
24
Table: Patented Drug Market Indicators, Historical Data And Forecasts (Australia 2011-2019)
26
Generic Drug Market Forecast
27
Table: Cost Of Selected Drugs Post-Price Disclosure, April 2013
30
Table: Generic Drug Market Indicators, Historical Data And Forecasts (Australia 2011-2019)
30
OTC Medicines Market Forecast
31
Table: Over-The-Counter (OTC) Medicine Market Indicators, Historical Data And Forecasts (Australia 2011-2019)
33
Pharmaceutical Trade Forecast
34
Table: Pharmaceutical Trade Data And Forecasts (Australia 2013-2019)
35
Table: Pharmaceutical Trade Data And Forecasts local currency (Australia 2013-2019)
36
Industry Risk Reward Index
37
Asia Pacific Risk/Reward Index
37
Australia Risk/Reward Index
44
Rewards
44
Risks
45
Regulatory Review
46
Table: EU & ICH Guidelines Adopted In The TGA's Biosimilars Guidance Document
47
Intellectual Property Issues
50
Pricing & Reimbursement Regime
54
Table: Selected Drugs Undergoing SPD (AUD)
55
Table: Historical PBS Co-Payments
56
Table: New PBS Formularies
60
Market Overview
61
Healthcare Sector
61
Research And Development
63
Clinical Trials
65
Epidemiology
66
Competitive Landscape
69
Research-Based Industry
69
Company Developments
70
Table: Multinational Market Activity
71
Pharmaceutical Distribution
72
Company Profile
74
Australian Pharmaceutical Industries
74
CSL
77
GlaxoSmithKline
81
Mayne Pharma Group
85
Sanofi
89
Sigma
92
Demographic Forecast
96
Table: Population Headline Indicators (Australia 1990-2025)
97
Table: Key Population Ratios (Australia 1990-2025)
97
Table: Urban/Rural Population & Life Expectancy (Australia 1990-2025)
98
Table: Population By Age Group (Australia 1990-2025)
98
Table: Population By Age Group % (Australia 1990-2025)
99
Glossary
101
Methodology
103
Pharmaceutical Expenditure Forecast Model
103
Healthcare Expenditure Forecast Model
103
Notes On Methodology
104
Risk/Reward Index Methodology
105
Index Overview
106
Table: Pharmaceutical Risk/Reward Index Indicators
106
Indicator Weightings
107

The Australia Pharmaceuticals & Healthcare Report features BMI Research's forecasts for drugs and healthcare expenditure and imports and exports, focusing on the growth outlook for the prescription, OTC, patented drugs and generics market segments.

BMI's Australia Pharmaceuticals & Healthcare Report provides industry professionals, strategists, company executives, investors, analysts and sales/marketing heads with independent forecasts and competitive intelligence on the Australia pharmaceutical and healthcare industry.

Key Benefits

  • Benchmark BMI's pharmaceutical and healthcare market forecasts for Australia, to test other views - a key input for successful budgeting and strategic business planning in the Australian pharmaceutical and healthcare market.
  • Target business opportunities and risks in the Australian pharmaceutical and healthcare sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Australia.
  • Assess the activities, strategy and market position of your competitors using our company profiles (including SWOTs, KPIs and latest activity) and competitive landscape tables.

Coverage

BMI Industry View

An at-a-glance perspective on the latest regulatory developments, key forecast indicators and major corporate developments, covering the prescription, OTC and generics markets. The pharmaceuticals and healthcare SWOT outlines strategic factors that affect the basic assumptions underpinning BMI’s forecast analysis, and taken together with BMI’s political, economic and business environment SWOTs, it gives a complete overview of market climate.

BMI Industry Forecast Scenario

Industry forecasts to end-2019 for all key indicators, supported by explicit assumptions, plus analysis of key downside risks to the main forecasts:

  • Healthcare: Total healthcare expenditure (USDbn), healthcare expenditure (% of GDP), healthcare expenditure per capita (USD), hospital beds, doctors, and birth & mortality rates (all per ‘000 population).
  • Pharmaceutical Market: Drug expenditure in USDbn, % of GDP and per capita (USD).
  • Patented Drug Market: Prescription drug sales (USDbn & % of total sales).
  • Generic Drug Market: Generic product sales (USDbn), generic sales (% of total sales).
  • OTC Drug Market: OTC sales (USDbn & % of total sales).
  • Macroeconomic Forecasts: Nominal and real GDP, % real GDP growth, % private consumption growth, % industrial output growth, % consumer price index, % GDP price deflator, exports, imports, trade balance, current account balance, foreign direct investment, exchange rate against USD, government expenditure and external debt.

BMI’s Pharmaceuticals and Healthcare Risk Reward Index

BMI’s Risk Reward Index provides investors (both national and multinational) looking for opportunities in the region with a clear country-comparative assessment of the market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors, with each position explained.

Market Summary

A snapshot of key market characteristics, including total size of the pharmaceuticals and healthcare segments, growth drivers, leading therapeutic areas and the competitive landscape

Industry Developments

A focus on government healthcare reforms, epidemiological trends, mergers and acquisitions, product launches, market entries, FDI activity, R&D, biotechnology, clinical trials and supply chain issues.

Regulatory Regime

Details of the industry regulatory framework and key legislation covering the licensing of new products/services, pricing and reimbursements, intellectual property, taxation and advertising, as well as analysis of the overall regulatory burden.

Competitive Landscape

The competitive landscape section provides comparative company analyses and index by USD sales and % share of total sales – for the total pharmaceutical sector, as well as the OTC, generics and distribution sub-sectors.

Company Profiles*

Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate Company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.