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Pharmaceutical

Drug sales down in US, slower elsewhere

April 22, 2009
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Pharmaceutical sales, squeezed by the worldwide recession, will increase globally by the slowest rate in a quarter-century and decline in the U.S. this year, according to the Associated Press. A new forecast by data firm IMS Health is a big sign that an industry long considered recession-proof is feeling the effects of the global slowdown. IMS, which tracks medication sales in more than 100 countries, said it expects a growth rate of 2.5 percent to 3.5 percent worldwide over 2008 sales. In the U.S., IMS expects pharmaceutical sales to actually decline by a percent or two this year. Then remain flat through 2013. Reasons for the slowdown in the U.S. include the recession, looming competition from cheaper generic versions of blockbuster drugs, the lack of new big sellers, more pressure by insurers and government payers to hold down their costs, and patients having to pay more of their own prescription costs. IMS said it expects global sales of prescription and nonprescription drugs to total more than $750 billion in 2009, after calculating the impact of exchange rates. That''s down from its October prediction of more than $820 billion. About $15 billion of that change is directly attributable to the economy. The rest is attributable to the effects of a strengthening dollar, because IMS converts all sales from local currencies into dollars at current and expected exchange rates to arrive at its total estimate. While the U.S. market is down or flat, the IMS report forecasts growth through 2013 will range from 1 percent to 4 percent in "mature markets," which include Canada, France, Germany, Italy, Japan, Spain and the United Kingdom. IMS said it expects the pharmaceutical sector to feel effects from the recession, although not as greatly as many other industries, through next year, when a rebound is expected. Economists once thought the health care sector was basically immune from recessions. That has not been the case this time around, with revenue down noticeably in recent months at drug and medical device makers and hospitals, and people scrimping or putting off doctor’s visits, elective medical procedures and other health care.
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