The global pharmaceutical industry is undergoing a consolidation phase in order to combat price pressure, competition and patent cliffs. Innovation is of vital importance for steady growth of pharmaceutical companies. Pharmaceutical companies have been mainly dependent on a few blockbuster molecules. However,with rapid decline in research and development (R&D) productivity and non-conducive regulatory environment, companies need to find different avenues of growth. The patent expiry of blockbuster drugs is expected to pave way for generics. Due to difference in genetic composition of varied individuals, innovation is becoming more complex.This is influencing players offering complementary products and services to collaborate for new product development.
There are four major factors that are impacting the value creation in pharmaceutical industry:
Demand for personalized medicines is increasing in order to ensure effective treatment of various diseases
Investments in R&D for oncology and NCDs are increasing globally in order to provide cost-effective solutions available to ailing patients.
Market Challenges
The industry is facing certain challenges such as patent cliff, cost pressure and regulatory uncertainties across the globe. This is hindering market growth to a certain extent. Moreover, regulatory authorities are becoming more stringent with the drug approval process. However, with respect to drugs for rare diseases, the FDA has offered a fast-track approval process. Moreover, demand for cost-effective treatment for chronic and non-communicable diseases such as diabetes, hypertension, thyroid disorder, obesity, and cancer is increasing. However, there is a dearth of strong products in the pipeline that offer better treatment option with fewer side effects. The fear of side effects and long-term treatment costs is encouraging patients to shift to alternative therapies.
Combating Challenges
Market players need to combat these challenges and keep their pace with the industry to sustain their market share. Mergers, acquisitions, and divestitures of products, companies or business division is a rapidly emerging trend in the market to combat prevalent challenges in the market.Companies are more focused in terms of therapy areas and hence, are divesting less focused therapy businesses. A good example is the swap deal between GSK and Novartis in 2015.
Moreover, pharmaceutical companies are investing in consumer health products,with increasing consumer’s health awareness and emerging trend of self-medication. These trends are encouraging pharmaceutical companies to enter the OTC market and leverage their brand equity among the doctors, chemists and consumers. Companies such as GlaxoSmithKline, Cipla, Pfizer, Merck, Sun Pharma, and Abbott have a focused division or subsidiary for consumer healthcare products and markets.
Moreover, to combat increasing cost pressure, companies are evolving their distribution channel. Establishing facilities or presence through collaboration in regional markets has helped companies meet local demand with reduced costs and delivery time. Emergence of e-pharmacy has resulted in creation of a separate team in the organization to service consumers ordering medicines online. Moreover, companies are connecting with consumers through social media, which helps improve brand visibility. The distribution channel has thus evolved significantly from the decade old channel consisting of only wholesalers and physical retail shops.
Patient-centricity
Patients are increasingly becoming well informed and organized, sometimes demanding for a particular product from prescribers. Therefore, companies need to be more patient-centric in their approach and provide quality care to consumers. Pharmaceutical companies are focusing on established direct to consumer distribution channels and establishing a more strong relationship with them. Moreover, companies are creating a good purchase experience for consumers through different offerings such as post-purchase medical services, engaging the patient through social media and events, and providing regular product alerts and refilling services.
Growth in Emerging Economies
The pharmaceutical industry is rapidly expanding in emerging economies such as Asia Pacific, Africa, and Latin America. These regions possess immense potential for growth of pharmaceutical companies, owing to inadequate access to medicines, growing population and increasing incidence of non-communicable diseases (NCDs). Besides, demand for contract research and manufacturing is also high in these regions. China and India are the largest emerging markets for CRO and CMO. Companies are highly dependent on China for API supply owing to low purchase cost. Overdependence on a single country can pose a challenge for the pharmaceuticals sector in the near future. Therefore, other emerging countries such as India, Brazil and South Africa are encouraging investments in their country. Besides, global companies are establishing their facilities in Asia Pacific, Middle East and Latin America regions to enable close monitoring and servicing of lucrative regional markets.
Conclusion
Pharmaceutical companies need to focus on an integrated, patient-centric, value-driven approach along with technology integration and strategic partnerships in order to capitalize on lucrative growth opportunities in the market. Major global players in the market include Pfizer Inc., Merck & Co., Inc., Bayer AG, GlaxoSmithKline plc., Sanofi, F. Hoffmann-La Roche AG, AstraZeneca plc. and Novartis AG.
There is a paradigm shift in process in the global pharmaceutical industry from product to a ‘Prodice’ (Product and Service) model, to offer affordable, accessible and quality care to patients.
The global amino acid market is estimated to be valued at US$ 2,689.82 million in 2023 and is expected to exhibit a CAGR of 6.9% during the forecast period (2023-2030). Increasing par... View more
The global pharmacy management system market was valued at US$ 53 Bn in 2022 and is forecast to reach a value of US$ 114.66 Bn by 2030 at a CAGR of 10.2% betwee... View more
Global Biologics Outsourcing market is estimated to be valued at US$ 19.67 Billion in 2023 and is expected to exhibit a CAGR of 12.9% during the forecast period (2023-2030). Growing t... View more
The global orodispersible tablets market experienced a significant expansion in recent years and is expected to continue growing during the forecast period from 2022 to 2030. Orodispersible tablets, also known as orally disintegrating tablets or quick-dissolving table... View more
The global ophthalmic drugs market was valued at US$ 45.62 Bn in 2022 and is forecast to reach a value of US$ 70.76 Bn by 2030 at a CAGR of 5.64% be... View more
The global Third Generation Sequencing market was valued at US$ 8.93 Bn in 2022 and is forecast to reach a value of US$ 23.92 Bn by 2030 at a ... View more
The Insulin Lispro market has been significant due to the increasing prevalence of diabetes globally. The global Insulin Lispro market size was valued at US$ 3.92 billion in 2022, and is projected to reach US$... View more
The global serotonin norepinephrine inhibitor market was valued at US$ 6.29 billion in 2022 and is expected to grow at a CAGR of 3.8% from 2023 to 2030. By the end of 2030, the market is projected to reach US$ 8.48 billion... View more
The global rabies antiserum market size was valued at US$ 1.20 billion in 2022. The market is projected to grow at a CAGR of 3.3% from 2022 to 2030, resulting in an estimated market size of US$ 1.55 billion by the end of 2030... View more
The global poultry antibiotic market size was valued at US$ 3.45 billion in 2022. The market is expected to experience a moderate growth rate in the coming years, with a projected CAGR of 5.8% from 2022 to 2030. This would result in a... View more
The global Fish Skin Disease Market, which includes treatments for fish diseases, was valued at US$ 1.72 Billion in 2022 and is expected to grow at a compound annual growth rate (CAGR) of 7.1% to reach US$ 2.98 Billion by end of 2030. The growth of the market is drive... View more
The global diagnostic radiopharmaceuticals and contrast media market was valued at US$ 6,434.9 Million in 2022 and is forecast to reach a value of US$ 10,140.7 Mn... View more
The global veterinary medicine market was valued at US$ 32,413.0 Mn in 2022 and is forecast to reach a value of US$ 50,160.7 Mn by 2030 at a CAGR of 5.7% betwee... View more
The global intramuscular vaccine adjuvants market size was valued at $650.6 million in 2022 and is expected to reach $1,088.9 million by 2030, with a CAGR of 6.7% during the forecast period. The increasing prevalence of infectious diseases, coupled with the growing ne... View more
The global biopharma buffer market size was valued at US$ 3.44 billion in 2022 and is expected to grow at a CAGR of 7.1% to reach US$ 5.95 billion by end of 2030. This growth can be attributed to the increasing demand for biopharmaceuticals and the growing adoption of... View more
The global veterinary dermatology drugs market size was valued at US$ 2.43 billion in 2022 and is expected to reach US$ 4.39 billion by end of 2030, growing at a CAGR of 7.67%. The growth of this market is attributed to the rising incidence of skin diseases in animals... View more
The global herpes simplex virus treatment market was valued at US$ 2,246.7 Mn in 2022 and is forecast to reach a value of US$ 3,503.7 Mn by 2030 at a CAGR of... View more
The global atrophic vaginitis market size was valued at USD 612.4 million in 2022 and is expected to grow at a CAGR of 7.5% over the forecast period 2023-2030. Atrophic vaginitis is a condition in which the vaginal walls become thin, dry, and inflamed due to a decreas... View more
The global HER-2 negative breast cancer market was valued at US$ 12,647.0 Mn in 2022 and is forecast to reach a value of US$ 27,201.2 Mn by 2030 at a CAGR of 10.1%&n... View more
Global human platelet lysate market is estimated to be valued at US$ 53.0 million in 2023 and is expected to exhibit a CAGR of 4.54% during the forecast period (2023-2030). ... View more