Now Available: Australia Pharmaceuticals & Healthcare Report Q2 2013

2013-02-27 03:07:13 - New Healthcare market report from Business Monitor International: "Australia Pharmaceuticals & Healthcare Report Q2 2013"

BMI View: Australia will remain as an attractive place to pharmaceutical firms, given its increasingly ageing population and the corresponding increase in non-communicable and often chronic diseases, despite its low growth potential. In particular, we expect generic drug makers to see more opportunities as the government is looking to rein in expenditures in a bid to reach a budget surplus.

Consequently, generic drug substitution, coupled with drug price cuts, will be key themes.

Headline Expenditure Projections

* Pharmaceuticals: AUD13.41bn (US$13.95bn) in 2012 to AUD13.85bn (US$13.92bn) in 2013; +3.3% in local currency terms and -0.2% in US dollar terms, due to exchange rate fluctuations.
* Healthcare: AUD129.90bn (US$135.09bn) in 2012 to AUD134.18bn (US$134.85bn) in 2013; +3.3% in local currency terms and -0.2% in US dollar terms, due to exchange rate fluctuations.


Full Report Details at
- www.fastmr.com/prod/541139_australia_pharmaceuticals_healthcare_ ..


Risk/Reward Rating:

Australia's Pharmaceutical Risk/Reward Rating (RRR) score for Q213 is unchanged from the previous quarter. This is also the case for all other countries in BMI's proprietary system that ranks pharmaceutical markets according to attractiveness to multinational drugmakers. A minor re-weighting of one of the RRR components is being implemented to improve the tool, and the adjusted scores for all markets will be published in the Q313 updates of the Pharmaceuticals & Healthcare reports. Australia has a RRR score of 66.2 out of 100, making it the second most attractive pharmaceutical market in Asia Pacific.

Key Trends And Developments

* In December 2012, the Australian Competition and Consumer Commission (ACCC) announced that pharmaceutical companies that are members of Medicines Australia will have two years to improve the transparency of payments and sponsorships they make to individual healthcare professionals. The statement was made by ACCC Commissioner Sarah Court. The new code of conduct is scheduled to come into force on January 11 2013. This will be the first time that the member companies are required to disclose aggregate payments made by them to doctors and consumer groups.
* In October 2012, the Australian government appointed an expert panel to review pharmaceutical patents. The panel will seek public comments before submitting a final report to the government in April 2013. Key considerations include the availability of competitively priced pharmaceuticals in the market, the role of the patent system in fostering innovation, providing employment and investment in research.
* In the same month, Treasurer Wayne Swan released a progress report on the Budget, revealing a deficit in tax receipts. He highlighted that the weak global economic growth has affected the country, making it harder to return to surplus. Under the pharmaceutical sector, the government will be reducing its funding for the Pharmaceutical Benefit Scheme (PBS). The reduction of prices of some drugs which will result in government savings of AUD164mn (US$170mn), while consumers are not affecting by these reduction, they also do not benefit from these savings as it did not translate to lower co-payments.

BMI Economic View: The Australian economy continues to slide closer to recession, due largely to slowing domestic demand. The country's external indebtedness, meanwhile, continue to grow unchecked. At present, these factors do not seem to be undermining demand for the Australian dollar, which is testing key resistance. We maintain, though, that from a risk/reward perspective, the AUD ranks at the bottom of the pile within Asia.

BMI Political View: Opinion polls conducted by Newspoll on December 7 2012 found that the ruling Australian Labour Party's (ALP) fell further behind, with 54% of those surveyed choosing the opposition Liberal-National coalition under a two-party preferred poll. We believe that the economy's deteriorating health will ultimately weigh on voters' minds, and do not expect any fiscal stimulus the government will implement to provide any permanent boost. Despite this poor performance by the ruling party, the coalition's leader, Tony Abbott continues to lag behind Prime Minister Julia Gillard in the leader ratings. As such, we see a growing possibility that the Liberal and National parties may seek a new leader to increase the chances of the coalition's win in the end-2013 elections.

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