BMI View: The UAE will continue to be an attractive emerging market for pharmaceutical companies as a result of continued investment into the country's healthcare sector. The rising prevalence of chronic diseases, such as diabetes, is prompting both the public and private sector to improve the population's access to healthcare services - this will act as the main driver of pharmaceutical expenditure in the UAE. However, d uring this period of oil price-driven austerity, the government is more likely to cut back spending on higher-value innovative drugs, posing a risk to multinational drugmakers.
Headline Expenditure Projections
Pharmaceuticals: AED9.46bn (USD2.58bn) in 2014 to AED10.32bn (USD2.81bn) in 2015; +9.1% in local currency terms and +9.2% US dollar terms. Forecast unchanged from last quarter.
Healthcare: AED49.88bn (USD13.58bn) in 2014 to AED52.64bn (USD14.34bn) in 2015; +5.5% in local currency terms and 5.6% in US dollar terms. Forecast revised upwards from last quarter.
|f = BMI forecast. Source: WHO, National Sources, BMI|
|Pharmaceutical sales, USDbn||2.299||2.576||2.812||3.055||3.305||3.554||3.807|
|Pharmaceutical sales, % of GDP||0.57||0.63||0.74||0.75||0.76||0.77||0.78|
|Pharmaceutical sales, % of health expenditure||17.9||19.0||19.6||20.1||20.6||20.9||21.0|
|Health spending, USDbn||12.876||13.581||14.344||15.163||16.060||17.043||18.092|
The UAE is one of the most rewarding markets for pharmaceutical and healthcare providers in the Middle East and African region. It has a fast-growing private healthcare sector, which brings with it demand for innovative and patented drugs. The UAE's relative political stability also contributes to the country's high regional score. In our Q1 2016 Indices, the UAE scores 62.5, up from last quarter's score of 61.8, making it the most attractive market in our Middle East and African regional matrix followed closely by Saudi Arabia (59.8).
In November 2015, the Dubai Health Authority (DHA) launched an innovative diabetes management protocol, supported by multinational drugmakers Novartis, Novo Nordisk, and Merck Sharp and Dohme.
In November 2015, the DHA revealed that Dubai had treated 135,000 medical tourists in 2014, representing around 1.1% of the total tourist arrivals in the country. The DHA expects figures to increase to 170,000 medical tourists in 2016, with revenues of about AED1.1bn (USD299.5mn).
The UAE's health ministry has allocated about AED462mn (USD125.78mn) for the procurement of medicines and medical supplies in 2016 in order to ensure an uninterrupted supply. From that amount, around AED321mn (USD87.39mn) will be used for the purchase of medicines.
In October 2015, the UAE's health ministry cleared 90 new complementary medicines as part of its strategy to include herbal and traditional drugs in the mainstream healthcare systems.
Work on Abu Dhabi's first cancer drug plant is expected to being in 2016. The USD40mn facility aims to manufacture more than 55 products and employ about 150 employees when operational in 2017.
BMI Economic View
The UAE's economic growth will slow over the coming quarters given lower oil prices; however growth rates will still be impressive. We forecast real GDP growth of 3.4% in 2016 and 3.0% in 2017, from an estimated 4.0% in 2015.
BMI Political View
The UAE is one of the best insulated from regional instability and we see few risks to the status quo over the coming years. However, it is important to note threats facing security in the country, namely the possibility of terrorist attack or domestic opposition, even though they remain minimal.
The United Arab Emirates 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 United Arab Emirates Pharmaceuticals & Healthcare Report provides industry professionals, strategists, company executives, investors, analysts and sales/marketing heads with independent forecasts and competitive intelligence on the United Arab Emirates pharmaceutical and healthcare industry.
- Benchmark BMI's pharmaceutical and healthcare market forecasts for United Arab Emirates, to test other views - a key input for successful budgeting and strategic business planning in the Emirati pharmaceutical and healthcare market.
- Target business opportunities and risks in the Emirati pharmaceutical and healthcare sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in United Arab Emirates.
- 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.