2013-01-31 08:57:57 - Recently published research from Business Monitor International, "Hong Kong Pharmaceuticals & Healthcare Report Q1 2013", is now available at Fast Market Research
BMI View: Hong Kong will continue to attract pharmaceutical investors' interest due to the population's affluence and its close proximity to China. However, we caution that the lack of significant development in terms of biopharmaceutical advancement in comparison to regional peers such as Singapore, Taiwan, China and South Korea means that the attractiveness of the market will dwindle over the longer term, should other developing countries such as Indonesia, Malaysia and the Philippines succeed in implementing their biotechnology agendas.
Headline Expenditure Projections
* Pharmaceuticals: HKD9.58bn (US$1.23bn) in 2011 to HKD10.37bn (US$1.33bn) in 2012; +8.2% in local currency terms and +8.4% in US dollar terms. Forecast broadly unchanged from Q412.
* Healthcare: HKD100.80bn (US$12.95bn) in 2011 to HKD106.69bn (US$13.73bn) in 2012; +5.9%
in local currency terms and +6.0% in US dollar terms. Forecast broadly unchanged from Q412.
* Medical devices: HKD4.34bn (US$558mn) in 2011 to HKD4.64bn (US$598mn) in 2012; +7.0% in local currency terms and +7.2% in US dollar terms. Forecast unchanged from Q412.
Full Report Details at
- www.fastmr.com/prod/529349_hong_kong_pharmaceuticals_healthcare_ ..
Risk/Reward Ratings: Hong Kong maintains its rank at seventh out of the 18 key regional markets in BMI's Q113 Asia Pacific Pharmaceutical Risk/Reward Ratings. Its overall score of 60.2 is supported by the country's relatively stable political and economic situation, and its appreciation of a strong legal framework. However, the size of its pharmaceutical market is restricted by its small population.
Key Trends And Developments
* In October 2012, the Society of Hospital Pharmacists of Hong Kong (SHP) said many private healthcare clinics offering cancer treatment in Hong Kong are potential 'death traps', China Daily reported. The SHP said many cancer treatment clinics have insufficient safety measures, and that most of the 19 private clinics in Central Hong Kong have failed to deliver safe treatment to cancer patients entailing intravenous infusion services. It also warned that 90% of anti-cancer drugs used in the clinics may be hazardous to health. The SHP requested for the Health Steering Committee to review the safety regulations for private healthcare facilities and extend its control on clinics offering intravenous drugs for chemotherapy.
* In September 2012, Hong Kong's environment ministry gave approval to China National Biotec Group (CNBG) to raise up to US$1.58bn in an initial public offering (IPO). CNBG, which manufactures vaccines and blood products, is planning to raise US$1.3 - 1.6bn through the Hong Kong IPO. However, the public offering is subject to clearance by the China Securities Regulatory Commission. CNBG has not yet announced a date for the offering.
* In August 2012, Hong Kong executive councillor Bernard Charnwut Chan said he is not keen to develop the special administrative region (SAR) into a Chinese medicine hub, as it does not have a competitive advantage over mainland China. In particular he told The Standard newspaper that establishing medical or education hubs requires land, which Hong Kong lacks. Chan added that the SAR does not have a competitive advantage in the scientific research field.
BMI Economic View: While the recent jump in prices runs against our call for a correction to the real estate market, we are not abandoning our bearish take on the market. Prices have become even more overstretched. We are not discounting a further marginal near-term upside in prices, as investors ride on bullish sentiment from the equity markets, as well as the third round of quantitative easing. That said, we believe receding demand, stemming from further economic deterioration and the government's tightening measures, coupled with anticipation of a meaningful increase in housing supply over the coming years, will combine to enforce a correction in property prices in 2013.
BMI Political View: Following the conclusion of legislative elections in Hong Kong, the city's pro China parties have held on to their majority within the lawmaking body. However, their failure to win more than two-thirds of the 70 seats means that pro democracy opposition parties will retain their veto power. As highlighted before, we do not expect a material change to our sanguine outlook for Hong Kong's business environment in the near term. However, we caution that increased presence of more radical prodemocracy parties within the legislature carries some downside risks.
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Business Monitor International (BMI) offers a comprehensive range of products and services designed to help senior executives, analysts and researchers assess and better manage operating risks, and exploit business opportunities, across 175 markets. BMI offers three main areas of expertise: Country Risk BMI's country risk and macroeconomic forecast portfolio includes weekly financial market reports, monthly regional Monitors, and in-depth quarterly Business Forecast Reports. Industry Analysis BMI covers a total of 17 industry verticals through a portfolio of services, including in-depth quarterly Country Forecast Reports. View more research from Business Monitor International at www.fastmr.com/catalog/publishers.aspx?pubid=1010
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