European Pharmaceutical Industry

Report Highlights

• In terms of population, the European pharmaceutical market is potentially the largest single market in the world. In 1999 it was valued at $94 billion and accounted for 40% of global production. By 2005 we estimate its value will be $150 billion, the increase due to European Single Market convergence, which will provide competition incentives. Demand for pharmaceuticals will also increase as the proportion of the European population over 65 continues to grow.
• Market growth should average about 8% between the years 1999 to 2005 in Europe, compared to 12.3% in the U.S. and 10.5% for the world market as a whole. Both markets will benefit by the rising ranks of the elderly, as well as intensified global research and development. Europe's share of the total market will fall to 35% by the end of the forecast period.
• BCC projects NCEs, the research and development of which leads to drugs, will increase at an average annual growth rate of 3.1% from 1999 to 2005 in Europe and 6.8% during the same time frame in the U.S.

INTRODUCTION

STUDY GOALS AND OBJECTIVES

This report analyzes the European pharmaceutical industry and predicts market trends and forecasts into the year 2005. A major focus of the report is the regulatory environment of the European Union and the impact of pressure to keep drug prices down in order to support the public health care systems of Member States while remaining globally competitive. Industry, national and European Union strategies are presented with expert analysis.

Profiles by country, as well as by industry leaders in patented, generic and OTC drug categories, are examined. Major therapeutic categories are included, as well as the emerging European biotech industry.

report_highlightss of the report also include the shift to a Single Market with gradual harmonization of prices, parallel trade, and current and future impact of the EURO. Leading industry and government officials were interviewed during the preparation of this report.

REASONS FOR THIS STUDY

The European pharmaceutical industry has historically been a top performer. With the shift to a Single Market, the sector is undergoing historic changes and is at a crossroads in its battle to remain competitive. The emerging European biotech industry is also changing the face of Europe, and investors are eyeing product pipelines closely.

CONTRIBUTIONS OF THE STUDY AND FOR WHOM

One of the top three industries in Europe, the pharmaceutical industry is focusing on staying competitive within the framework of the EU. The industry is searching for new and innovative ideas and alliances in order to discover new chemical entities, leading to blockbuster and niche drugs.

This report provides an analysis of the entire European pharmaceutical industry and the Single Market and its implications for the future. All segments of the industry are examined, as well as an in-depth look at the Single Market, particularly the governmental market and pricing regulation. The report is geared towards decision makers in the global pharmaceutical industry from America, Europe, Japan and elsewhere to include:

• Pharmaceutical industry executives
• Biotehnology industry executives
• Pharmaceutical suppliers and wholesalers
• Researchers -- private/academic/governmental
• Venture capital companies
• Equipment manufacturers
• Pharmacists
• Merger, acquisition, and investment executives

SCOPE AND FORMAT

This report is a tool to be used as a guide to the European pharmaceutical market. It is also a reference point for European Union laws, regulations, and directives in force for the Single European Market.

An overview of the European pharmaceutical market follows. Competitiveness is closely studied. The report focuses on pharmaceuticals and biotechnology in Europe, country by country. The market segments of patented, generic and Over-the-Counter (OTC) drugs are closely examined. The large number of innovator products set to lose their patents in Europe over the next ten years should foster robust growth for generics. The EU should also see increased OTC competition as governments weaken price controls.

The European Union as well as other government agencies and organizations are examined.

METHODOLOGY AND INFORMATION SOURCES

Primary interviews were used with industry personnel as well as EU, European Commission, and national government officials. Industry professional organizations also provided primary data.

Secondary sources, such as company literature, on-line databases and web sites, trade associations and publications, and governmental databases provided supplemental information for a deeper understanding of the overall industry and current and future trends. All dollar projections presented in this report are in 1999 constant dollars.