Pharmaceutical

Enquiry IconContact Us

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:

  • Market
    • Stress from patent expiries, niche marketing, and patient-centricity is challenging the growth plans of pharmaceutical companies. Moreover, in emerging markets, companies face strong competition from local players,who sell product at a much lower cost. To counter the same global companies need to significantly reduce their profit margins.
  • Technology
    • Rapid integration of healthcare and information technology is posing threat for current blockbuster drugs
    • Products based on new technologies offer superior properties and are more efficient as compared to existing products in the market
  • Regulation
    • There is constant price pressure from governments to meet demands of growing number of patients
    • Emerging markets have regulatory uncertainty, where decisions are made to protect the interests of the general population
    • Moreover, governments, especially in emerging economies are encouraging pharmaceutical companies to focus on preventive measures for diseases, which involves major investments
  • Innovation
    • Need for innovative products or therapies is rising constantly due to rising pressure of patent-cliff coupled with reducing profit margins
    • Identification of new bacterial and viral strains is driving the need for novel drugs

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.

View More

Pharmaceutical Published Insights

Coherent Market Insights

Insulin Glargine Market, By Type (Insulin Glargine) and By Geography (North America, Europe, Asia-Pacific, Middle East and Africa, and South America)- Size, Share, Outlook, and Opportunity Analysis, 2022 - 2028

Published Date : Sep 2022

The global insulin glargine market was valued at US$ 6,153.5 Mn in 2021 and is forecast to reach a value of US$ 6,257.7 Mn by 2028 at a CAGR of 0.2% between&nbs... View more

Coherent Market Insights

Human Tuberculosis Vaccine Market, by Route of Administration (Intradermal and Percutaneous), by Age Group (Pediatrics and Adults), by Distribution Channel (Public and Private) and by Region (North America, Latin America, Europe, Asia Pacific, Middle East, and Africa) - Size, Share, Outlook, and Opportunity Analysis, 2022 - 2030

Published Date : Sep 2022

Tuberculosis (TB) is caused by a bacterium known as Mycobacterium tuberculosis. The bacteria usually attack the lungs, but TB bacteria can attack any part of the body such as the kidney, spine, and brain. There are two TB-related conditions which exist, they are laten... View more

Coherent Market Insights

Monkeypox Treatment Market, by Treatment Type  (Prophylactic (vaccines), Therapeutics (Tecovirimat, Brincidofovir, Cidofovir)), by Route of Administration (Oral, Injectable), by Distribution Channel (Retail Pharmacies, Hospital Pharmacies, Online Pharmacies), and by Region (North America, Europe, Asia Pacific, Middle East, Africa, and Latin America) - Size, Share, Outlook, and Opportunity Analysis, 2022 - 2030

Published Date : Sep 2022

Two outbreaks of a disease resembling the pox in colonies of monkeys kept for research led to the discovery of monkeypox in 1958. The monkeypox virus is the cause of this rare viral disease. Monkeypox is a type of Zoonotic disease, which are transmitted from animals t... View more

Coherent Market Insights

Treatment Resistant Depression Market, by Drug Type (Antidepressants (Selective Serotonin Reuptake Inhibitors, Serotonin-norepinephrine Reuptake Inhibitors, and Others) Atypical agents, others), by Distribution Channel (Hospital Pharmacies, Retail Pharmacies, and Online Pharmacies), and by Region (North America, Latin America, Europe, Asia Pacific, Middle East, and Africa) - Size, Share, Outlook, and Opportunity Analysis, 2022 - 2030

Published Date : Sep 2022

Depression is a mental condition characterized by a continuous sense of sadness as well as a loss of interest. It affects how patients feel, think, and behave and can lead to a variety of mental and physical difficulties. It is also known as major depressive disorder ... View more

Coherent Market Insights

Flumazenil Market, by Dose (5 ml, 10 ml), by Application (Anti – Sedation, Reversing Drowsiness, Others (Hepatic Encephalopathy, Cirrhosis), by Distribution Channel (Hospital Pharmacies, Retail Pharmacies, Online Pharmacies), and by Region (North America, Latin America, Europe, Asia Pacific, Middle East, and Africa) - Size, Share, Outlook, and Opportunity Analysis, 2022 - 2030

Published Date : Aug 2022

Flumazenil is an antagonist directed through injection or intranasally. Medicinally, it performances as antagonist and antidote to benzodiazepines. Flumazenil is also used in anesthesia to wake up the patient after diagnostic tests. Flumazenil is administered in the v... View more

Subscribe Newsletter

Kindly subscribe for our latest news & articles.