New projections for global drug sales look pretty for generics makers--but not so pretty for brands. The growth in generics is expected to depress overall pharma sales growth, as lower-priced copies replace top-dollar brand names. In fact, global sales growth could be reduced by half over the next five years, Reuters reports.
According to new numbers from IMS Health, average annual sales will grow from 3 percent to 6 percent through 2015, to nearly $1.1 trillion. That may sound good, but it's slower--perhaps much slower--than the average annual growth of 6.2 percent during the last five years.
As one might expect, given the numbers on emerging markets, future growth will be weighted toward the developing world, with U.S. sales projected to rise by 3 percent at the most per year, and perhaps not at all. European sales are projected to increase by 1 percent to 4 percent. What's more, that growth will come in the form of increased generics sales; branded drug sales are expected to be mostly flat.
"There are unprecedented dynamics at play, which are driving rapid shifts in the mix of spending by patients and payers between branded products and generics," as IMS Health's Murray Aitken said. Too few novel drugs are winning regulatory approval to offset that big shift in spending mix, he added.
Internationally, the share of drug spending will shift markedly, too. The U.S.'s share of global drug sales will drop to 31 percent in 2015, down from 41 percent in 2005. The top five European countries, which accounted for 20 percent of spending in 2005, will make up only 13 percent. But the 17 "pharmerging markets," led by China, will account for 28 percent of total spending by 2015, up from 12 percent in 2005. In other words, those emerging markets will surpass the top five Euro-markets--and will be hot on the heels of the U.S.
- see the IMS release
- read the Reuters news