The pharmaceutical market in South Korea will register a slow but steady rise from $18.6 billion in 2016 to $20.4 billion in 2020.
This is according to new market research from analysts at GlobalData, who see the compound annual growth rate (CAGR) of meds in the country reaching just 2.4%, as the Korean government increasingly focuses on generics in order to reduce healthcare spend.
The company’s latest report found that the country’s generics market increased from $3.5 billion in 2008 to around $5.8 billion in 2015--growing at a CAGR of 7%--as the government has invested significantly in the generics market in recent years.
Many new drugs are set to lose their patents by 2020--meaning South Korea’s generics market is expected to increase significantly, the analysts predict.
Adam Dion, GlobalData’s senior industry analyst, said in a release: “Overall market growth is expected to be influenced by burgeoning treatment populations and various government initiatives to encourage research and development and sustain growth in the pharmaceutical industry, such as the Korean Small Business Innovation Research program.”
The analysts said that other government initiatives will also aid businesses, such as lifting the ban on advertisements for medical services, which has enabled hospitals to hire advertising agencies to help them attract medical tourists.
Dion explained: “The Free Trade Agreement with the U.S., which began in March 2012, has had the effect of lowering tariffs for imports up to 80%, and nearly 95% of bilateral trade in consumer and industrial products has become duty-free for up to five years, making investment in the South Korean pharmaceutical industry easier for multinational companies.”
This comes as South Korea is attempting to build up its own life science sphere as new companies look to build on the success of its native biosimilar giant Celltrion.
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