Positive Currency Effects Help Global Pharmaceutical Market Grow by 5.3 Percent in 2011, Although Lower Growth Expected Going Forward Due to Cost Containment and Key Patent Expiries
Pfizer Remained Top Pharmaceutical Company by Sales in 2011, But Novartis Should Take the Top Ranking by 2015, According to New Data from Decision Resources
BURLINGTON, Mass.--(BUSINESS WIRE)--Decision Resources, one of the world's leading research and advisory firms for pharmaceutical and healthcare issues, finds that in 2011, the global pharmaceutical market, in dollar terms, benefitted significantly from positive currency effects. According to new data from Decision Resources' Pharmaview suite, global pharmaceutical sales grew year-over-year by a respectable 5.3 percent to reach $707 billion, compared with 3.6 percent year-over-year growth in 2010. The relative weakness of the dollar in 2011 compared to 2010 played a large part in this growth, and many of the major drug companies, such as Pfizer, Abbott, Eli Lilly and Johnson & Johnson all reported positive currency effects of between 2 percent and 4 percent in 2011.
But, Pharmaview analysis finds that with the industry entering a period of significant patent expiries, and with ongoing economic headwinds and cost-containment efforts by payers worldwide, future growth looks anemic at best. Over the next seven years, the global market is expected to record a compound annual growth rate (CAGR) of just 2.1 percent, reaching $817 billion in 2018. At the company level, Pfizer retained its spot as the top pharmaceutical company by sales by a considerable margin, with $58 billion in ethical drug sales in 2011. However, with Lipitor now experiencing generic competition, Decision Resources expects Novartis to be the leading company by 2015, and for it to maintain this position throughout the remainder of the forecast period to 2018.
"Unsurprisingly, the major pharmaceutical companies face a host of challenges going forward. Of the current top 10, only GlaxoSmithKline and Johnson & Johnson are expected to show organic growth between 2011 and 2018. Many of the others, such as AstraZeneca, Merck & Co. and Eli Lilly, are expected to experience a precipitous decline in sales as patent protection around many of their key brands expires," said Pharmaview Director Alasdair Milton, Ph.D. "The industry remains fragmented, and we believe that there is still room for further consolidation, as the top-line of many companies continues to decline, and shareholders put pressure on management to increase value."
The sales findings are from the most recent release of Decision Resources' Pharmaview, which assesses the commercial aspect of the global pharmaceutical market and provides continually updated analysis of more than 2,900 drugs from more than 280 companies, covering 167 product classes and 14 therapy areas. Pharmaview also provides deep-dive analysis into the world's leading biopharmaceutical companies.
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