2013-02-01 18:15:52 - New Healthcare market report from Business Monitor International: "Jordan Pharmaceuticals & Healthcare Report Q1 2013"

BMI View: We expect that Jordan will continue to provide modest opportunities to research-based pharmaceutical manufacturers. In line with the authorities' efforts to expand healthcare insurance coverage, we envisage measures aiming to promote the use of cheaper generic medicines, in tandem with price-reduction strategies. Nevertheless, the expansion of government provision and the higher uptake of generic medicines will conspire to keep longer term growth steady, boosted by upward volume changes, with the patented drug market to continue to be supported by rising numbers of medical tourists.

Headline Expenditure Projections

* Pharmaceuticals: JOD463mn (US$653mn) in 2011 to JOD501mn (US$707mn) in 2012; +8.1% in local currency terms and +8.1% in US dollar terms. Forecast unchanged from Q412.
* Healthcare: JOD1.73bn (US$2.45bn) in 2011

to JOD1.87bn (US$2.65bn) in 2012; +8.0% in local currency terms and +8.1% in US dollar terms. Forecast unchanged from Q412.
* Medical devices: JOD112mn (US$158mn) in 2011 to JOD121mn (US$171mn) in 2012; +8.3% in local currency terms and +8.4% in US dollar terms. Forecast unchanged from Q412.


Full Report Details at
- www.fastmr.com/prod/529391_jordan_pharmaceuticals_healthcare_rep ..


Risk/Reward Rating: Jordan's composite Pharmaceutical Risk/Reward Ratings score for Q113 remains unchanged in relation to the previous quarter. At 49.9 out of the maximum 100, Jordan is again ranked 10th, out of the 30 markets surveyed in the Middle East and Africa region. Jordan's rewards and risk scores remain evenly balanced, with both components standing firmly above the regional averages.

Key Trends And Developments

* In July 2012, Hayel Obeidat, director general of the Jordanian Food and Drug Administration (FDA), said that the prices of 275 locally and internationally produced drugs had been reduced. The medicines affected by the changes include painkillers and treatments for chronic diseases and cancer. Any company or drugstore found guilty of not reducing drug prices in line with this policy will be penalised, Obeidat added. Fines totalling over JOD1mn (US$1.4mn) have already been collected from firms that rejected the immediate price reduction. The JFDA is now reviewing the reduction of prices for an additional 25 drugs.
* The number of foreign patients visiting Jordan for medical treatment increased by 7% year-onyear (y-o-y) in H112. Although medical tourism in Jordan has emerged as the most robust healthcare sector in the entire Middle East, Private Hospitals Association (PHA) President Fawzi Hammouri was quoted by Jordan Times as saying that the sector still needs to overcome certain challenges to achieve further growth in terms of patient numbers and revenues. He identified Jordanian visa regulations and continuing brain drain to be the major barriers for medical tourism to attain its maximum potential.

BMI Economic View: Economic growth in Jordan will remain sluggish over the coming years. Weak foreign direct investment (FDI) inflows, a flagging tourism sector and high commodity prices will drag on the economy in the near term, while policymakers have few fiscal or monetary levers at their disposal to manufacture any turnaround in the country's fortunes. We forecast real GDP growth to fall to 1.8% this year, from 2.6% in 2011, with the country suffering from the detrimental effect that the Arab Spring (and in particular the ongoing conflict in Syria) has had on both foreign investment and the tourism industry.

BMI Political View: The October 2012 decision by King Abdullah to dissolve the current progovernment parliament was widely expected, but is unlikely to lead to any improvement in the country's political situation. With the opposition all but certain to boycott the elections, which are expected by early 2013 at the latest, we expect the next parliament to look remarkably similar. This undermines the credibility of the King's move, and denies him a much-needed opportunity to rally popular support behind his fiscal consolidation efforts, potentially placing them in jeopardy.

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