South Africa Pharmaceuticals & Healthcare Report

Published 02 April 2015

  • 125 pages
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$1,295.00
South Africa Pharmaceuticals & Healthcare Report

BMI View: The continued commitment of the South African government to boosting spending on healthcare will be the primary driver for the growth of the pharmaceutical market in 2015. Although lower oil prices will improve the consumer environment for lower cost medicines, rampant unemployment will continue to hurt private consumption growth.

Headline Expenditure Projections

  • Pharmaceuticals: ZAR39.79bn (USD3.67bn) in 2014 to ZAR43.44bn (USD3.65bn) in 2015; +9.2% in local currency terms and -0.6% in US dollar terms.

  • Healthcare: ZAR332.81bn (USD30.68bn) in 2014 to ZAR362.91bn (USD30.45bn) in 2015; +9.0% in local currency terms and -0.7% in US dollar terms.

Risk/Reward Index

South Africa has strong longer-term commercial potential because of its sizeable population and economic development. However, the impact of currency depreciation and a worsening economic outlook have hurt its short term growth prospects. In Q215, South Africa's place has fallen from fourth to eighth position in the Middle East and Africa Risk Reward Index, with a score of 51.4 out of 100.

Key Trends And Developments

  • South Africa's budget for 2015 was set in March and South Africa's healthcare sector received an 8.8% increase in funding for the 2015/16 fiscal year with an allocation of ZAR157.3bn (USD13.3bn). Expenditure is expected to increase steadily and reach ZAR178bn (USD15.1bn) in the 2017/18 fiscal year. The healthcare budget corresponds to 12.9% of the allocated expenditure, falling short of the 15% pledged as part of the 2001 Abuja Declaration. Economic Affairs, Defence, Public Order and Safety, Education, Social Protection and Local Development and Social Infrastructure all received a larger share of the budget than healthcare.

  • In March 2015, South Africa-based Bidvest, which owns a 34.5% stake in pharmaceutical group Adcock Ingram, has offered to buy the remaining stake for ZAR52 (USD4.45) a share. The proposal includes the purchase of current Adcock black economic...

Table of Contents

BMI Industry View
7
SWOT
9
Political
11
Economic
12
Business Environment
13
Industry Forecast
14
Pharmaceutical Market Forecast
14
Table: Pharmaceutical Sales, Historical Data And Forecasts (South Africa 2010-2018)
15
Healthcare Market Forecast
16
Table: Healthcare Expenditure Trends, Historical Data And Forecasts (South Africa 2010-2018)
17
Table: Government Healthcare Expenditure Trends, Historical Data And Forecasts (South Africa 2010-2018)
17
Table: Private Healthcare Expenditure Trends, Historical Data And Forecasts (South Africa 2010-2018)
18
Prescription Drug Market Forecast
18
Table: Prescription Drug Market Indicators, Historical Data And Forecasts (South Africa 2010-2018)
19
Patented Drug Market Forecast
20
Table: South Africa Patented Drug Market Indicators, Historical Data And Forecasts (South Africa 2010-2018)
21
Generic Drug Market Forecast
22
Table: South Africa Generic Drug Market Indicators, Historical Data And Forecasts (South Africa 2010-2018)
23
OTC Medicine Market Forecast
24
Table: South Africa OTC Medicine Market Indicators, Historical Data And Forecasts
26
Pharmaceutical Trade Forecast
26
Table: Pharmaceutical Trade Data And Forecasts (South Africa 2012-2018)
27
Table: Pharmaceutical Trade Data And Forecasts Local Currency (South Africa 2012-2018)
28
Other Healthcare Data
29
Key Risks To BMI's Forecast Scenario
30
Macroeconomic Forecasts
32
Expenditure Breakdown
32
Industry Risk Reward Ratings
35
Middle East & Africa Risk/Reward Ratings
35
South Africa Risk/Reward Ratings
42
Rewards
42
Risks
43
Market Overview
44
Industry Trends And Developments
45
Epidemiology
45
Healthcare Sector
49
Public Healthcare Sector
49
Private Healthcare Sector
51
Private Healthcare Sector Developments
55
National Health Reference Price List
56
Healthcare Infrastructure
56
Research & Development Sector
57
Clinical Trials
58
Vaccines
59
Traditional African Medicine
60
Telemedicine
61
Regulatory Development
62
Table: Drug Classification System
62
Regulatory Developments
65
Intellectual Property Environment
66
Pricing Regime
68
Table: Tiered Pharmaceutical Pricing System Is Better Than A Flat Fixed Mark-Up
69
Table: SEP Inflation, 2008-2011
70
Reimbursement Regime
70
Competitive Landscape
72
Pharmaceutical Industry
72
Pharmaceutical Pricing
75
Pharmaceutical Retail Sector
77
Private Healthcare Market
78
Company Profile
79
Aspen Pharmacare
79
Adcock Ingram
84
Cipla Medpro
89
Ranbaxy
92
Sanofi
94
Pfizer
97
Roche
100
GlaxoSmithKline
103
Merck & Co
107
Novartis
109
Demographic Forecast
111
Table: South Africa's Population By Age Group, 1990-2020 ('000)
112
Table: South Africa's Population By Age Group, 1990-2020 (% of total)
113
Table: South Africa's Key Population Ratios, 1990-2020
114
Table: South Africa's Rural And Urban Population, 1990-2020
114
Glossary
115
Methodology
117
Pharmaceutical Expenditure Forecast Model
117
Healthcare Expenditure Forecast Model
117
Notes On Methodology
118
Risk/Reward Ratings Methodology
119
Ratings Overview
120
Table: Pharmaceutical Risk/Reward Ratings Indicators
120
Indicator Weightings
121

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

Key Benefits

  • Benchmark BMI's pharmaceutical and healthcare market forecasts for South Africa, to test other views - a key input for successful budgeting and strategic business planning in the South African pharmaceutical and healthcare market.
  • Target business opportunities and risks in the South African pharmaceutical and healthcare sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in South Africa.
  • 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.

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Testimonials

'An essential, multi-faceted research tool. BMI’s thorough understanding of the major market players enables an informed – and informative – review of the sector’s actual performance, together with useful insights into current industry issues, which are topped-off with detailed and invaluable forecasts of industry and macroeconomic trends.’

Senior Research Analyst, ABC International Bank plc