Peru Pharmaceuticals & Healthcare

Summary

The Peruvian pharmaceutical market is currently approaching its value of 1997, at around US$495mn, making the market one of the smallest in Latin America. Until very recently, regulatory conditions were considered unacceptable by international standards, and although there has been significant reform in terms of intellectual property, other areas of market regulation are poorly conceived and enforced.

The Peruvian Congress has endorsed to a free-trade agreement with the US. The treaty introduces significant new terms relating to the protection of confidential data submitted to regulatory authorities. Meanwhile, the government has also created tougher requirements for generic products regarding clinical proof of therapeutic equivalence, as well as safety and efficacy, in relation to original products. Despite this positive progress, so-called 'similar' drugs - branded, non-equivalent copies of local origin - account for as much as 40% of the market in value terms. There is little evidence that the new measures will force the withdrawal of inferior quality products in the short term.

In terms of the breakdown of the market, the formal prescription market accounts for approximately 85% of sales, although it should be noted that some 55% of Peruvians routinely self-medicate with pharmaceuticals that are designated as prescription-only. Partly due to a thriving retail market in the major urban centres, the over-the-counter sector accounts for the remainder of sales. BMI 's valuation for the generics sector - comprising equivalent, off-patent medicines - is some US$24mn for 2005, although this total is expected to more than double by the end of the forecast period.

The small size of the Peruvian pharmaceutical market and its poor regulatory environment have prompted BMI to rank the market seventh out of eight leading Latin American markets surveyed. Although the US FTA is a positive signal for the future, the more sophisticated markets of Mexico and Brazil are expected to attract the majority share of pharmaceutical sector investment in the region over the forecast period. At the same time, there appears to be little hope of a significant increase in healthcare sector investment, however badly such an increase may be required. Accordingly, BMI believes that market expansion will remain dependent upon the country's continued solid macroeconomic performance.

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

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.

Outline of market characteristics, growth factors, leading therapeutic segments and a competitivness of the market.

Guide to and analysis of country intellectual property developments and pricing & reimbursement issues, which constitute the regulatory make-up of the market.

Focus on government healthcare reforms, epidemiological trends, company M&As, product launches, market entries, FDI activity, R&D and patent legislation.

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.

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

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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