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Sweden Pharmaceuticals and Healthcare Report Q1 2011
Business Monitor International, Nov 2010, Pages: 56
Sweden Pharmaceuticals and Healthcare Report provides industry professionals and strategists, corporate analysts, pharmaceutical associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Sweden's pharmaceuticals and healthcare industry.
Despite a compound annual growth rate (CAGR) of 4.61% in local currency terms and 3.77% in US dollar terms from 2004-2009, BMI’s outlook for Sweden’s drug market is considerably less optimistic over the next five years. Over 2009-2014, a CAGR of -0.95% is projected in local currency terms (which translates into -0.84% in US dollar terms), largely as a result of the impending patent cliff and the consequent consumption of lower-value generic drugs in place of high-value patented drugs. By 2014, pharmaceutical expenditure in Sweden is expected to reach a value of SEK28.94bn (US$3.79bn), falling from SEK30.36bn (US$3.97bn) posted in 2009.
While the Swedish pharmaceutical market is expected to return to positive territory over our longer, 10- year forecast period (posting a local currency CAGR of 1.45%), Sweden is ranked in sixth place in our Pharmaceuticals Business Environment Ratings matrix for Q111 out of the 10 Western European markets. Globally, Sweden is placed 15th, below Brazil and above Poland, out of the total of 83 countries surveyed. While the country’s strong emphasis on the regulatory environment is a draw, a major factor affecting the business environment for drugmakers is its small overall market size which, combined with downward pressures on pharmaceutical spending, have conspired to negatively impact the Industry Rewards score in particular. Nevertheless, given its high per capita drug expenditure levels, medicines continue to bring in substantial income for companies operating in the country.
In terms of recent company news, Swedish BioPhausia decided to start a streamlining process in order to focus on the Nordic market. The company will phase out its less profitable operations and products to strengthen its profitability and benefit from new business opportunities arising from events such as the deregulation of the pharmacy market in Sweden. The company is aiming to adapt to changing market situations and better respond to external factors.
Economically speaking, our view that Sweden will be among the top-performing Western European economies through the long term remains unchanged and we have revised up our 2010 real GDP growth forecast to 3.7%. Despite the upward revision, we maintain that a slowdown in headline growth is inevitable as inventory restocking and low base effects wear off in the second half of 2010. We forecast Swedish growth to drop back to 2.6% in 2011, although this will remain well above the 1.4% forecast for the eurozone. Therefore, opportunities for players in the healthcare market in general will remain, as private provision of services is also expected to gain more of a foothold in the country.
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