Summary
The Croatian pharmaceuticals market is characterised by an extraordinarily high rate of generic penetration, distinct intellectual property deficiencies and the dominance of a solitary domestic player, according to BMI's newly published "Croatia Pharmaceuticals & Healthcare Report". Despite these undesirable features, growth is buoyant and market value is expected to reach US$670mn by 2010.
Generic drugs account for over 70% of the market in value terms, which is unprecedented in Europe. The primary reason for the lack of branded drugs is that multinationals choose not to launch them in the country because patent laws are not observed. Compounding the issue, registration of proprietary products can take up to three years, whereas approvals of generics are fast-tracked, often taking less than nine months. However, it should be noted that co-operation with EU patent authorities is increasing, and registrations in Croatia are equivalent to those inside the EU.
The adjusted Business Environment Rankings for the major 14 Central & Eastern Europe markets reveal that Croatia has maintained its 13thplace, just ahead of neighbouring Serbia. Croatia posts moderate scores for political risk and economic risk, but is let down by market size and domestic sector threat. Indeed, the major Croatian player is Pliva , which commands nearly a 25% market share. The firm exploits the country's bias towards generics and is increasingly looking towards other CEE countries for growth. However, Pliva is currently the focus of a bidding war between US company Barr Laboratories and Iceland's Actavis , both desperate to penetrate the booming CEE generics market. It remains to seen which foreign raider will triumph, but it is the reports view that a takeover by Barr would be preferable for Pliva and other interested parties, as the US firm has pledged to preserve Pliva's independence.
Limiting the attractiveness of the country in terms of foreign investment is the country's severe healthcare debt. By April 2006, the Croatian healthcare system had run up debts of HRK4.6bn (US$760mn), and the hospital sector on its own continues to plunge a further HRK100mn (US$17.6mn) into debt every month. The primary cause of the arrears is excessive drugs bills, which became so extreme that wholesalers were not paid for months. However, the Ministry of Health has established a control committee to audit hospital spending and tighten management, recognising that the system is approaching collapse. Officials have also proposed a change in drugs policy, with the setting up of a mainly generic essential drugs list that would be provided free of charge under the health insurance scheme, and an additional drugs list containing 'more expensive' drugs whose price difference would be met by the patient.
On a positive note, the country has established a life sciences park in partnership with a Swiss-US consortium. The collaboration is the first public-private partnership between the Croatian government and a large international investor and could provide the impetus for more foreign investment.
Key Benefits of Report
- Rely On Our Independent 5-Year Forecasts As A Benchmark
to test other views - a key input for successful budgetary and strategic business planning.
- Target Business Opportunities & Risks
through our reviews of latest industry trends, regulatory changes, and major deals, projects and investments
- Exploit Latest Competitive Intelligence & Company SWOTS
on your competitors and peers through company rankings by sales, market share and ownership structure – includes multinational and national companies.
Scope of Report
Executive Summary & Industry SWOT
An at-a-glance perspective on latest regulatory developments, key forecast indicators and major corporate developments, covering the prescription, OTC and generics markets. The SWOT outlines strategic factors which affect BMI’s forecast analysis, and taken together with BMI’s Economic and Business Environment SWOTS, give a complete overview of market climate.
Market Summary
Outline of market characteristics, growth factors, leading therapeutic segments and a competitivness of the market.
Regulatory Regime
Guide to and analysis of country intellectual property developments and pricing & reimbursement issues, which constitute the regulatory make-up of the market.
Industry Developments
Focus on government healthcare reforms, epidemiological trends, company M&As, product launches, market entries, FDI activity, R&D and patent legislation.
5-Year Industry Forecast
5-Year Forecasts to end-2010 for all key industry indicators (see list below), supported by explicit assumptions, plus analysis of key downside risks to the main forecast, including:
- Drug market expenditure (US$bn); drug expenditure per capita (US$); as % of gdp
- Prescription drug market (US$bn)/as % of total market; sales by alimentary tract/metabolism; antibiotics, cardiovascular, central nervous system, oncology, musculoskeletal and respiratory system
- OTC market (US$bn)/as % of total market (sales by analgesic, cough and cold, digestives, skin treatments, vitamins and minerals)
- Generics market (US$bn)/ as % of total market
- Health expenditure (US$bn, % of gdp and per capita); public sector health expenditure as % of total; number of hospitals; beds, hospital admissions, doctors, births and deaths per 000 population
Forecasts based on bespoke BMI economic modelling, using historical data sets of macroeconomic and industry variables to derive rigorous statistical relationships, anchored in advanced linear regression techniques.
5-Year Macroeconomic Forecasts
BMI forecasts for all headline macroeconomic indicators, including:
Nominal and real GDP, % real GDP growth, % private consumption growth, % industrial output growth, % consumer price index, % GDP price deflator, exports, imports, trade balance, current account balance, foreign direct investment, exchange rate against US$, government expenditure, external debt
Competitive Landscape & Profiles
Intelligence on the market position of major MNC power houses and indigenous companies. BMI profiles key research-based companies. Company SWOTS are provided for all key strategic players, complete with a company activity overview, its leading products and analysis of business opportunities.
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