Pharm industry sales to top $1.2 trillion by 2016
Globalization impacts demand and production of pharmaceuticals
By Julie Ackerman
Pharmaceutical manufacturers today face a considerable checklist of significant challenges, including the fight against counterfeiting, reducing costs through offshore manufacturing and maintaining product integrity. PMMI recently surveyed 50 pharmaceutical and medical-device professionals to gain greater insight into these challenges and the state of the industry from their perspective. Findings are summarized in PMMI’s recently released 2012 Pharmaceutical/Medical Devices Market Assessment. Some of the study’s key learnings are as follows:
• The global pharmaceutical industry is projected to emerge from its current modest growth phase of 3% to 4% CAGR (compound annual growth rate) and rise to 5% to 7% annually in 2016. Global sales will total about $1.2 trillion in 2016, up from about $956 billion in 2011, according to the IMS Institute for Healthcare Informatics in a July 2012 report. By 2016, emerging markets will represent 30% of global spending on medicines, compared to 20% in 2011.
• Counterfeit drugs represent an estimated 10% of all medications in the U.S., according to the FDA, while the World Health Organization estimates that 70% of the drug supply in underdeveloped countries is counterfeit. Much has changed over the past five years for pharmaceutical manufacturers when it comes to packaging. Counterfeiting has become one of the biggest problems facing the pharmaceutical industry as criminals are now counterfeiting all types of products and medical devices — not just tablets and capsules.
• Despite the popularity of offshore manufacturing, some companies interviewed said they are considering returning production to the U.S. Some of the reasons cited include:
• Compliance issues
• Improved quality
• Better control of the supply chain
• A more costly exchange of the Euro
Of all the reasons cited for returning manufacturing to the U.S., quality control is arguably the most influential. A reduction in quality can not only lead to fines in the hundreds of millions of dollars for non-compliance with FDA requirements for products exported back into the U.S., it can seriously damage a manufacturer’s reputation. The latter is often considered to be more costly to a company in the long run than any fine.
PMMI’s 2012 Pharmaceutical/Medical Devices Market Assessment can be downloaded from PMMI.org. There is no charge for the Executive Summary. The complete report is free to PMMI members.
Pharmaceutical professionals will find comprehensive industry insight and a look at the latest technology at PACK EXPO Las Vegas 2013, Sept. 23-25; Las Vegas Convention Center, Las Vegas, Nev. The show will offer a number of resources to pharmaceutical professionals, including the Pharmaceutical Pavilion, which will feature the latest advances in labeling, filling and inspection systems as well as blister packaging, flexible pouches, tubes and closures among others. In addition, The Rx Lounge will serve as a networking hub for attendees, allowing them to share ideas and engage in a dialogue with suppliers.
For more information about PACK EXPO Las Vegas 2013, visit Packexpo.com.
PMMI is a trade association of more than 600 member companies that manufacture packaging, processing and related converting machinery in the United States, Canada and Mexico; machinery components and packaging containers and materials. PMMI’s vision is to be the leading global resource for the packaging and processing supply chain, and its mission is to improve and promote members’ abilities to meet the needs of their customers.
PMMI organizes the PACK EXPO trade shows: PACK EXPO International, PACK EXPO Las Vegas and EXPO PACK México, connecting participants in the packaging and processing supply chain with their customers around the world. Coming Up: PACK EXPO Las Vegas at Las Vegas Convention Center, Sep. 23–25, 2013; EXPO PACK Guadalajara at Expo Guadalajara 2013, February 27–March 1; EXPO PACK México 2013 at Centro Banamex, Mexico City, June 18–21.
Julie Ackerman is senior director, communications/public relations, PMMI.