Processing Magazine

Report: US drug sales growth heads toward new low

October 29, 2008

A report issued from IMS Health says that U.S. sales of pharmaceuticals will grow at the slowest rate on record this year, as the weakening economy compounds other factors hampering the industry, according to the Associated Press. While pharmaceuticals have traditionally been resilient to economic downturns, recent reports show consumers already are cutting back on prescriptions. Pfizer last week reported U.S. sales of its best-selling drug, the cholesterol pill Lipitor, fell 13 percent in the third quarter. And a survey by the Kaiser Family Foundation this month found almost one-third of patients have skipped medical treatment in the past year, up from 24 percent in April. IMS predicts U.S. pharmaceutical sales will remain at the 1 to 2 percent growth rate next year. Global sales also are expected to grow at a rate of 4.5 to 5.5 percent in 2009, about the same as this year. Growth in developing countries like China, Brazil and India, where demand for improved health care is expected to raise sales between 14 and 15 percent, will continue to outpace developed countries. The overall size of the pharmaceutical market will be eroded by $24 billion worth of drugs expected to lose patent protection next year. Expirations have given a boost to generic drug makers in recent years as they swoop in to offer low-cost versions at a fraction of the original price. Still, generic sales in 2009 are forecast to be flat at about $68 billion as the increasingly crowded industry forces generic manufacturers to lower their prices, cutting profit margins. IMS expects new drug approvals to remain at historically low levels, with just 25 to 30 first-of-a kind drug launches in 2009.