Global Pharmaceutical Market Shows Moderate Growth

The global pharmaceutical market experienced moderate growth in 2005, with North American sales* increasing slightly over 5% from 2004, according to a recent analysis by IMS Health Inc. (Fairfield, CT, www.imshealth.com).  Other key trends are continued strong growth in China, a rise in the number of drugs reaching blockbuster status, projected strong growth in generics, and an increase in the number of biologic-based drugs in the pipeline.

Total global pharmaceutical sales increased 7% to $602 billion in 2005, IMS said. In the ten major markets, which account for 81% of total global pharmaceutical sales, growth increased 5.7%, compared with 7.2% in 2004.

North America, which accounts for 47% of global pharmaceutical sales, grew 5.2% to $265.7 billion, while Europe experienced a somewhat higher growth of 7.1% to $169.5 billion in 2005. Sales in Latin America grew 18.5% to $24 billion, while Asia Pacific (outside of Japan) and Africa grew 11% to $46.4 billion. Japan-the world’s second largest market, which has historically posted slower growth rates-performed strongly in 2005, growing 6.8% to $60.3 billion, its highest year-over-year growth since 1991, according to IMS Health.

Pharmaceutical sales in China grew 20.4% to $11.7 billion in 2005, representing the third consecutive year that the market has achieved growth of 20% or more. IMS estimates that China will be the world’s seventh largest pharmaceutical market by 2009.

Overall, IMS forecasts that the total pharmaceutical market will expand at a compound annual growth rate of 5–8% over the next five years. North America and Europe are each projected to grow at a 5–8%, Asia Pacific and Africa, 9–12%, Latin America, 7–10%, and Japan, 3–6%.

Number of drugs reaching blockbuster status increases

The number of blockbuster products (those with sales exceeding the billion-dollar level) reached 94 in 2005, compared with 36 in 2000, according to IMS Health. This included 17 new drugs reaching blockbuster status.“The end of blockbusters is not upon us, despite what some analysts are saying,” says Murray Aitken, IMS's senior vice-president for corporate strategy. “In fact, we expect that blockbusters will continue to be an important part of pharmaceutical market growth over the next five years, due to new uses for existing therapies, the emergence of niche/specialty products, and the ongoing demand for chronic disease treatments.” 

Six blockbusters are expected to lose their patents in 2006, which will contribute to further growth in the generics market. In 2005, combined sales of generics in the top eight markets (Unites States, Canada, France, Germany, Italy, Spain, United Kingdom, and Japan) exceeded $55 billion, and are expected to experience double-digit growth over the next five years, according to IMS.

Pipeline increases

In 2005, more than 2300 products were in clinical development, up 9% from 2004 levels, and up 31% over the past three years, according to IMS. A breakdown of drugs in Phase III clinical trials or preapproval stage shows 96 oncology products, 51 products for treating cardiovascular disease, 37 for viral infections and HIV, and 28 for arthritis and pain. Of the total pipeline, 27% of these products are biologic in nature-an all-time high, according to IMS.

*The data in the IMS analysis reflect pharmaceutical sales figures measured in current US dollars, include prescription and certain over-the-counter data, and reflect ex-manufacturer prices. Growth in sales is measured in constant dollars.