Summary
The Brazilian pharmaceuticals market is the largest in South America, and was valued at US$9.2bn in 2005. In recent months, growth in US dollar terms has been strong, largely due to favourable currency effects and rising consumer demand. IMS Health retail market data places year-on-year growth rates in May 2006 at around 42%, although in local currency terms, local industry sources estimate the current rate of expansion at only 10.8%.
The market is dominated by branded products, which despite the strenuous efforts of government policymakers continues to account for 88.7% of sales in value terms. However, the share of the prescription sector is lower, at nearly 73%, due to the large over-the-counter market - which is in turn distorted by the traditional prevalence of illicit sales of prescription-only products without the need to present a doctor script. Although the advertising environment for non-OTC products is strict, the lack of a clear division between the two markets makes valuations problematic. For example, IMS Health valued the market for genuine OTC products at just BRL265mn (US$122.6mn) in 2005.
Despite the traditional consumer preference for branded products, and the key role played by doctors as gatekeepers to the market, the generics sector remains the market's fastest-growing segment. The legitimate generics sector's share of the Brazilian market reached 10.26% in the 12 months to May 2006, with annually adjusted growth estimated at 31.3% in the month. The government has launched a number of high-profile initiatives to promote off-patent, bioequivalent medicines in recent years - not all of which have been successful. This is largely attributable to the continued presence of so-called 'similar' medicines, or non-equivalent copies of local origin.
Although operational conditions remain challenging, foreign direct investment is increasing. Brazil is becoming an attractive regional base for multinationals including, most recently, the US manufacturer Bristol-Myers Squibb. Such investments are aimed at minimising exposure to smaller, less well-regulated markets in the region, while also developing the country's potential as an export base. The indigenous industry, meanwhile, is consolidating with the encouragement of official economic development agencies, and heavy private sector investment in marketing and product development is reported.
Nevertheless, there remain risks for research-based firms in Brazil. Although the sector is clearly a priority for foreign investment, the direction of healthcare sector reform is focused on providing affordable medicines to low-income citizens. A direct system of price controls is applied to all prescription drugs and some OTC products. Meanwhile, foreign R&D-based firms continue to complain that government's rhetoric on pharmaceutical patents is taking an increasingly aggressive tone.
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 SWOTSon 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 The’s forecast analysis, and taken together with The’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.
The 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$bn, % of gdp and per capita); public sector health expenditure as % of total; number of hospitals; beds, hospital admissions, doctors, births and deaths per 000 population
Forecasts based on bespoke The economic modelling, using historical data sets of macroeconomic and industry variables to derive rigorous statistical relationships, anchored in advanced linear regression techniques.
The 5-Year Macroeconomic Forecasts
The forecasts for all headline macroeconomic indicators, including:
Nominal and real GDP, % real GDP growth, % private consumption growth, % industrial output growth, % consumer price index, % GDP price deflator, exports, imports, trade balance, current account balance, foreign direct investment, exchange rate against US$, government expenditure, external debt
Competitive Landscape & Profiles
Intelligence on the market position of major MNC power houses and indigenous companies. The 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. Companies Covered:Abbott Laboratories, Bayer AG, Boehringer Ingelheim Group, Biosinttica, Eli Lilly, Elmor, Farmaindustria, GlaxoSmithKline plc, Grupo Farma, Lab Ach, Lab Andrmaco, Lab Bag, Lab Maver, Lafrancol, Merck & Co Inc, Novartis AG, Novo Nordisk, Pfizer Inc, Roche, Sanofi-Aventis
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