BMI View: SSN pharmaceutical expenditure will decline in 2016 - intensifying the revenue pressures for drugmakers and pharmacies in Italy, and increasing out-of-pocket costs for the population. The government remains committed to remaining under the 3% of GDP budget deficit limit and using any additional fiscal capacity to ease the tax burden instead of ramping up spending. This will continue to negatively impact the healthcare sector and particularly pharmaceutical spending, a large beneficiary of public funds.
Headline Expenditure Projections
Pharmaceuticals: EUR26.91bn (USD29.84bn) in 2015 to EUR27.21bn (USD29.11bn) in 2016; -1.1% in local currency terms and -2.5% in US dollar terms.
Healthcare: EUR150.49bn (USD166.90bn) in 2015 to EUR151.91bn (USD162.55bn) in 2016; +1% in local currency terms and -2.6% in US dollar terms.
|f = BMI forecast. Source: WHO, National Sources, BMI|
|Pharmaceutical sales, USDbn||35.350||29.840||29.110||30.290||32.080||33.930||34.400|
|Pharmaceutical sales, % of GDP||1.65||1.64||1.64||1.61||1.59||1.57||1.56|
|Pharmaceutical sales, % of health expenditure||17.9||17.9||17.9||17.9||18.0||18.0||17.9|
|Health spending, USDbn||198.010||166.900||162.550||168.830||178.570||188.900||191.870|
R isk/Reward Index
In our Pharmaceuticals and Healthcare Risk/Reward Index for Q316, Italy comes in 13th 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 63.4.
In the first nine months of 2015, the national total pharmaceutical expenditure (public and private) totalled EUR21.3bn.
Overall, the direct contribution of pharmacies towards pharmaceutical cost containment in the first nine months of 2015 was approximately EUR580mn (USD660mn).
In September 2015, patient co-payments for medicines stood at 13.5%, a slight decrease from 13.5% in September 2015.
BMI Economic View
Tight credit conditions and a weak labour market will continue to weigh on Italy's growth in 2016, despite the passage of reforms aimed at addressing each issue. We are modestly below consensus in our real GDP growth forecasts of 1.0% and 1.2% in 2016 and 2017 respectively.
BMI Political View
Prime Minister Matteo Renzi appears safe for now, but mounting economic headwinds could undermine his government. There are several plausible scenarios in which fresh elections are called before end-2016, and polls indicate that the anti-establishment 5-Star Movement could beat Renzi's centre-left Democratic Party in a head-to-head matchup.
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.