BMI View: With lower revenues from oil exports and significant costs associated with the battle against Islamic State, the Iraqi government will continue to face headwinds in providing healthcare to its population. Furthermore , economic headwinds will also feed through to consumer spending, deterring investment in adequate access to healthcare and medicines, which in turn will weigh on a more significant market recovery. However, strong demand for healthcare will continue to translate to pharmaceuticals and healthcare sector growth over the forecast period.
Headline Expenditure Projections
Pharmaceuticals: IQD2.02trn (USD1.71bn) in 2015 to IQD2.19trn (USD1.71bn) in 2016; +8.2% in local currency and +0.2% in US dollar terms. Forecast broadly in line with last quarter .
Healthcare: IQD11.77trn (USD9.96bn) in 2015 to IQD12.54trn (USD9.83bn) in 2016; +6.6% in local currency and -1.3% in US dollar terms. Forecast revised downwards from last quarter.
|f = BMI forecast. Source: WHO, National Sources, BMI|
|Pharmaceutical sales, USDbn||1.594||1.710||1.714||1.834||1.949||2.068||2.180|
|Pharmaceutical sales, % of GDP||0.77||0.75||0.73||0.70||0.68||0.66||0.65|
|Pharmaceutical sales, % of health expenditure||16.8||17.2||17.4||17.7||17.9||18.0||18.2|
|Health spending, USDbn||9.483||9.963||9.831||10.377||10.905||11.466||12.004|
In Q216 we have revised downwards Iraq's Risk/Reward Index (RRI) score to 36.4 from 38.0 in the previous quarter (out of a maximum 100 points). The score revision was mainly driven by lower country risk indices and lower industry rewards indices. Iraq has shifted down five positions to 21st out of 31 markets in the Middle East and Africa Region in terms of attractiveness to pharmaceutical investors. While most score components are suffering from the effects of armed conflict and low oil prices, the pharmaceutical and healthcare sector will sustain its long-term potential for development.
In February 2016, Iraq introduced the inactivated polio vaccine (IPV) to its national immunization program, which has been welcomed by international health organizations as a step forward in strengthening access to health and protecting children's health.
In light of ongoing shortages of medicines in Iraq, Canadian philanthropist Stephen Arbib, CEO of MAG Logistics together with Humpty Dumpty Institute announced in January 2016 that they will send pharmaceuticals to Iraq at an estimated value of USD250,000.
In November 2015 Iraq's Ministry of Health announced the seizure of 43 tons of contraband drugs in the capital Baghdad, which reflects continuing efforts to reduce the introduction of counterfeit medicines in the country.
After the introduction of several health measures, including a cholera oral vaccination campaign by the Iraqi government with support from the WHO and UNICEF, as of November 22 2016 the two-months long cholera outbreak in Iraq has continued to decline with a few cases being reported from the affected districts.
In October 2015 Iraq's Prime Minister Haider al-Abadi attended the opening of al-Kafeel Specialized Hospital in the city of Karbala, a modern hospital that cost IQD120bn (USD110mn) and will be equipped with modern technology (Iraqi News).
BMI Economic View
The Iraqi economy will grow by a small 0.3% in real terms over 2016, as oil production plateaus and as low global oil prices limit government spending and slash capital expenditure. Non-oil economic activity will remain flat, as the conflict between Baghdad and Islamic State prevents manufacturing and agricultural production to recover.
BMI Political View
The hypothetical removal of Islamic State from Iraq would not lead to sectarian and ethnic tensions suddenly disappearing. Rather, confrontation is likely to increase between Kurdish forces and Baghdad and Shi'a militias once the main security threat is removed. In addition, the Sunni-Shi'a divide will remain high as long as the Sunni minority remains on the sideline of federal politics.
The Iraq 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 Iraq Pharmaceuticals & Healthcare Report provides industry professionals, strategists, company executives, investors, analysts and sales/marketing heads with independent forecasts and competitive intelligence on the Iraq pharmaceutical and healthcare industry.
- Benchmark BMI's pharmaceutical and healthcare market forecasts for Iraq, to test other views - a key input for successful budgeting and strategic business planning in the Iraqi pharmaceutical and healthcare market.
- Target business opportunities and risks in the Iraqi pharmaceutical and healthcare sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Iraq.
- Assess the activities, strategy and market position of your competitors using our company profiles (including SWOTs, KPIs and latest activity) and competitive landscape tables.
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.
A snapshot of key market characteristics, including total size of the pharmaceuticals and healthcare segments, growth drivers, leading therapeutic areas and the competitive landscape
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.
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.
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.
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.