2014-01-03 19:34:38 - Fast Market Research recommends "United States Pharmaceuticals & Healthcare Report Q1 2014" from Business Monitor International, now available
Despite the botched rollout of the Affordable Care Act, we expect reform of the US healthcare system to continue over the coming years, mainly due to the need to control growth in spending on medical services. Implementation will not be smooth due to the law's numerous opponents. We maintain that 'Obamacare' will bring only minor commercial upside to pharmaceutical companies.
Headline Expenditure Projections
* Pharmaceuticals: US$343.0bn in 2012 to US$341.2bn in 2013; -0.5% growth in local currency terms. Forecast slightly down from Q413 due to macroeconomic factors.
* Healthcare: US$2,806bn in 2012 to US$2,984bn in 2013; +6.3% growth in local currency terms. Forecast slightly down from Q413 due to macroeconomic factors.
Full Report Details at
- www.fastmr.com/prod/754773_united_states_pharmaceuticals_healthc ..
Risk/Reward Rating (RRR): The US
has a Pharmaceutical RRR score of 78.5 out of 100 for Q114. This is unchanged from Q413 but slightly down from the 80.9 score recorded in Q313, which was due to a downgrade in BMI's forecasts for pharmaceutical expenditure over the next ten years. Despite this negative development, the market remains highly attractive to all multinational drugmakers.
Key Trends And Developments
* In November 2013, Novartis filed a Citizen Petition with the FDA urging the Agency to require that a biosimilar share the same international non-proprietary names (INN) as its reference product. The company argues in its submission that changing the well-established convention for the INN to describe the active ingredient would undermine the safe and rational use of all biologics. Indivually, the Generic Pharmaceutical Association (GPhA) and its European counterpart, the European Generic medicines Association (EGA), both echoed the view expressed by Novartis.
* In October 2013, Republicans in the US Congress criticised Health and Human Services Secretary Kathleen Sebelius for declining to testify before an oversight panel about problems in rolling out Obamacare. The Republicans have sent a letter to Sebelius demanding that officials are available for the hearing on the technical issues with the federal marketplace's information technology system - which cost nearly US$400mn to build, according to a report by the watchdog Government Accountability Office. The website Healthcare.gov, the administration's online portal for consumers in 36 states, is facing issues such as error messages, garbled text and delays loading pages.
* In September 2013, California Governor Edmund G Brown Jr vetoed Senate Bill SB 598. The bill, introduced by Senator Jerry Hill (D-San Mateo) on February 22, sought to authorise pharmacists to substitute a biosimilar for a biologic under specified circumstances. Additionally, the bill required pharmacies notify the prescriber whether a prescription was dispensed with a biological product or an interchangeable biosimilar. It is this second requirement that led to the veto.
BMI Economic View: Strong fixed investment numbers but tepid personal consumption expenditure marked the advance estimate of Q313 real GDP growth, in line with our forecast for continued slow economic recovery in the US. The top line growth figure also benefitted from continued improvement in net exports and a diminished drag on the economy from government consumption and investment.
BMI Political View: US President Barack Obama and his Democratic allies are seeing their approval ratings plummet, partly in response to the failed rollout of the Affordable Care Act, the president's signature domestic accomplishment. We believe that popular ire over the healthcare law's troubles raises the possibility of more fiscal and debt ceiling brinksmanship over the next several months, and could weigh on Democrats in the 2014 mid-term election.
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