SALES TRENDS AND GROWTH CHALLENGES IN THE EVOLVING PHARMACEUTICAL MARKETPLACE

Drug development has always been a risky proposition,

so the experience of bringing a drug to market after mul-

tiple phases of clinical trials and meeting stringent safety

and efficacy standards is a relief for any developer.

But with rapid transformation in the global marketing

environment threatening to limit pharma companies’

success, beating the odds of drug development is only

half the battle.

Worldwide sales growth

The prescription drug market is projected to grow

by 5.1% per year to reach $1,017bn by the end of

the decade.

High-income vs. developing countriesWhile increased global connectedness has shifted

some industries’ focus toward developing markets,

pharma is moving more slowly in this direction.

High-income countries continue to dominate both

production and consumption.

02

More than $1 trillion of worldwide prescription drug sales expected by 2020.

03

• High-income countries comprised only 17% of the world’s

population, but constituted 79% of drug expenditures.

• The U.S. accounted for 34% of global pharmaceutical

expenditures, followed by Europe and Japan.

• 56% of medicines introduced in the previous four years

were sold in the U.S.

IN 2010

04

Despite the pharma industry’s slower progress, emerging and developing markets offer a great opportunity.Demand in these markets is expected to increase, and

at a faster pace than elsewhere. Aggregate annual

spending may reach $499bn by 2020.

Globalization is regarded as one of the most important—

if not the most important—drivers of economic activity

around the world. Pharmaceutical industry health can

also be attributed to an unwavering demand for

healthcare: People will continue to get sick, and an

increase in lifestyle-related diseases and continued

aging of the global population creates a growing need

for new medicines.

However, the pharma industry is far from immune to financial pressures. • Governments around the world have less funding

available to pay for medications and are actively

seeking to reduce their costs, hence the intense

scrutiny on drug pricing.

• There have even been lawsuits against companies

accused of trying to keep drug prices artificially high,

forcing companies to withdraw products from

certain markets.

• The ability to pay for new medicines varies from

country to country, undermining the global

connectedness of pharma markets.

05

The SolutionThese financial and political burdens make it critical for pharma and biotech companies to communicate the value of their medications.

They’ll need to:• Work smarter to reduce the costs of drug

development and marketing wherever possible

• Use real-world data to demonstrate the safety and cost-saving potential of their products

• Ensure operational consistency across markets with more centralized control

• Adopt technologies to facilitate the generation and collection of data according to an ever-changing regulatory landscape

Rather than trying to do everything internally, collaborating with a globalization services provider with specialized expertise of regional market shifts will be key.

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Sources:Evaluate Pharma. Worldwide total prescription drug sales 2006-20; 2014. http://info.evaluategroup.com/rs/evaluatepharmaltd/images/EP240614.pdf

Ghemawat P, Altman SA. DHL Global Connectedness Index 2012. Data sources include the World Health Organization (WHO), Organisation for

Economic Co-Operation and Development (OECD), IMS Health, UN Comtrade, Euromonitor, iSuppli, and ResearchinChina. http://www.dhl.com/en/about_us/logistics_insights/studies_research/global_connectedness_index/global_connectedness_index.html#.VFff5MkpXuM

Ibid. Map generated based on data from WHO, OECD, IMS, and estimates by Ghemawat and Altman.

Ibid. Calculated based on data from WHO, OECD, IMS, and World Development Indicators.

IMS Institute for Healthcare Informatics. The Global Use of Medicines: Outlook through 2016. Parsippany, NJ: IMS Institute for Healthcare Informatics; 2012. https://www.imshealth.com/files/web/IMSH%20Institute/Reports/The%20Global%20Use%20of%20Medicines%20Outlook%20Through%202016/Medicines_Outlook_Through_2016_Report.pdf

European Federation of Pharmaceutical Industries and Associations. The Pharmaceutical Industry in Figures: Key Data 2012. Brussels, Belgium:

European Federation of Pharmaceutical Industries and Associations; 2012. http://www.efpia.eu/uploads/Modules/Documents/efpia_figures_2012_ final-20120622-003-en-v1.pdf

PwC. From vision to decision: pharma 2020; 2012. Available at: http://www.pwc.com/gx/en/pharma-life-sciences/pharma2020/assets/pwc- pharma-success-strategies.pdf