BMI View: New Zealand's updated Health Strategy draft will see limited improvement to the challenging business environment for innovative drugmakers. Cost minimisation continues to be a key aspect of the approach adopted, with the Pharmaceutical Management Agency maintaining its dominant role in curbing pharmaceutical spending. Nonetheless, there will be opportunities for other segments of the health industry, such as telecare, which is poised to play a critical role in enabling New Zealand to achieve its objectives.
Headline Expenditure Forecasts
Pharmaceuticals : NZD1.45bn (USD1.20bn) in 2014 to NZD1.48bn (USD1.04bn) in 2015; 2.0% in local currency terms and -11.4% in US dollar terms. Forecast unchanged from last quarter.
Healthcare: NZD22.57bn (USD18.72bn) in 2014 to NZD23.10bn (USD16.17bn) in 2015; 2.4% in local currency terms and -13.6% in US dollar terms. Forecast in US dollar terms with a slight downward revision due to currency effects.
|f = BMI forecast. Source: WHO, National Sources, BMI|
|Pharmaceutical sales, USDbn||1.166||1.203||1.036||0.982||0.926||0.946||0.967|
|Pharmaceutical sales, % of GDP||0.63||0.61||0.61||0.60||0.58||0.57||0.56|
|Pharmaceutical sales, % of health expenditure||6.4||6.4||6.4||6.4||6.4||6.4||6.3|
|Health spending, USDbn||18.091||18.718||16.170||15.373||14.533||14.890||15.262|
In BMI's Q1 2016 Pharmaceutical Risk/Reward Index (RRIs), New Zealand, sustaining its place from Q4 2015, is ranked ninth out of the 19 markets in the matrix. With a score of 53.1 out of 100, unchanged from the previous three quarters, the country remained just above the regional average of 52.1. A strong and predictable environment of low operating risks are weighed down by a small market and low potential for growth relative to other markets in the region.
In October 2015, New Zealand along with the other 11 member states of the Trans-Pacific Partnership trade agreement concluded their negotiations. This trade deal affects many industries, including healthcare and regulatory data protection of biologics.
In November 2015, New Zealand and China established the Joint Centre for Biomedicine, a collaboration between the University of Auckland and the Chinese academy of sciences.
BMI Economic View
The New Zealand economy continues to suffer from the weakening dairy sector, and we forecast real GDP growth to slow to 2.4% in 2015, versus 3.3% in 2014. Meanwhile, we expect the New Zealand dollar to continue heading lower over the medium term, undermined by falling real interest rates as the economy continues to slow amid a terms of trade decline.
BMI Political View
New Zealand's revised health and safety bill, while reflecting a political compromise with the powerful dairy lobby, will go some way in improving workplace health and safety in the country. Despite an initial increase in production costs, the country's business environment is unlikely to be adversely impacted given the boost to long-term productivity as workplace accidents decline.
The New Zealand 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 New Zealand Pharmaceuticals & Healthcare Report provides industry professionals, strategists, company executives, investors, analysts and sales/marketing heads with independent forecasts and competitive intelligence on the New Zealand pharmaceutical and healthcare industry.
- Benchmark BMI's pharmaceutical and healthcare market forecasts for New Zealand, to test other views - a key input for successful budgeting and strategic business planning in the New Zealand pharmaceutical and healthcare market.
- Target business opportunities and risks in the New Zealand pharmaceutical and healthcare sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in New Zealand.
- 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.