BMI View : The rising demand for medicines for the treatment of cardiovascular diseases, gastric conditions, the nervous system and the respiratory system (the therapeutic areas that recorded the highest expenditure in 2015) and the government's aim in ensuring its population continues to access these medicines, will lead to complex pricing and reimbursement discussions, placing downward pressures on drugmaker revenue streams. Despite a long-term decline in the public expenditure of medicines, the implementation of further austerity measures targeting both the SSN and the sector is inevitable.
Headline Expenditure Projections
Pharmaceuticals: EUR28.93bn (USD32.08bn) in 2015 to EUR29.16bn (USD31.20bn) in 2016; +0.8% in local currency terms and -2.8% in US dollar terms.
Healthcare: EUR150.50bn (USD166.92bn) in 2015 to EUR151.88bn (USD162.51bn) in 2016; +0.9% in local currency terms and -2.6% in US dollar terms.
|f = BMI forecast. Source: WHO, National Sources, BMI|
|Pharmaceutical sales, USDbn||35.332||32.080||31.198||30.903||30.347||30.100||30.468|
|Pharmaceutical sales, % of GDP||1.65||1.77||1.77||1.74||1.72||1.70||1.68|
|Pharmaceutical sales, % of health expenditure||17.8||19.2||19.2||19.2||19.2||19.1||19.1|
|Health spending, USDbn||198.013||166.917||162.507||161.112||158.412||157.397||159.781|
In our Pharmaceuticals and Healthcare Risk/Reward Index for Q117, Italy comes in 11th place out of the 15 markets surveyed in Western Europe, above Ireland and Portugal and below the Netherlands and Spain. Despite being a large market, Italy is characterised by low levels of annual growth, largely due to of widespread price cuts, resulting in the market scoring a below average rating of 66.3 out of a total of 100.
In October 2016, AIFA reported that drugmakers including Roche, Gilead and Janssen-Cilag will have to pay back rebates of EUR1.49bn for an overspend on medicines during the 2013-2015 time period.
In October 2016, it was reported that the Italian Market Competition Authority (AGCM) is fining the multinational South African pharmaceutical company Aspen nearly EUR5.2mn on following its finding that Aspen abused its dominance to artificially inflate the price of four of its cancer drugs.
In 6M16, pharmaceutical expenditure by the SSN fell by 4.7% to EUR4.28bn (USD3.92bn).
BMI Economic View
Weaker external demand, rising political risks and a crippled banking sector will stifle Italy's nascent economic recovery. Subdued growth will impede fiscal consolidation efforts, leaving the economy highly vulnerable to confidence shocks and dependent on the implicit backstop of the European Central Bank.
BMI Political View
Italy's upcoming constitutional referendum poses the most salient short-term political risk, given its potential to topple the reformist government of Prime Minister Matteo Renzi. However, no matter the outcome, medium-term risks remain elevated due to a stagnant economy and the continued rise in popularity of the anti-establishment and eurosceptic 5-Star Movement, which could conceivably achieve a one-party government in 2018.
The Italy 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 Italy Pharmaceuticals & Healthcare Report provides industry professionals, strategists, company executives, investors, analysts and sales/marketing heads with independent forecasts and competitive intelligence on the Italy pharmaceutical and healthcare industry.
- Benchmark BMI's pharmaceutical and healthcare market forecasts for Italy, to test other views - a key input for successful budgeting and strategic business planning in the Italian pharmaceutical and healthcare market.
- Target business opportunities and risks in the Italian pharmaceutical and healthcare sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Italy.
- 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.