Saudi Arabia – KSA has largest pharma market in GCC

April 2, 2013 7:25 pm0 commentsViews: 85

JEDDAH – The GCC pharmaceutical industry is expected to experience sustainable growth in the medium to long term, Alpen Capital said Sunday in its GCC Pharmaceutical Industry report.

Increased domestic production, foreign investments, and consumption of generics are likely to support the market’s evolution. These factors are supported by growth drivers such as population growth, increasing life expectancy and growing income levels which will further enhance the expansion of the sector,” said Sameena Ahmad, Managing Director at Alpen Capital.

“We feel that government measures to control pricing of essential drugs and compulsory health insurance will increase local drug manufacturing in the Pharmaceutical sector. The absence of new molecules is pushing global majors to enter the generic drug space, As a result of the above factors, we see a surge in global companies entering the regional markets through joint ventures with local manufacturers”, said Sanjay Vig, Managing Director, Alpen Capital.

The GCC pharmaceutical sector has witnessed considerable progress over the years on the back of favorable demographic and economic factors, alongside strong government support for healthcare. Expansion of pharmaceutical sales in Qatar and Bahrain is projected to outpace the overall regional growth rate, thus translating into a higher market share of these countries at the regional level going forward.

The remaining Gulf countries are forecast to either maintain a stable share or experience a decline in their representation in the GCC pharmaceutical industry.

Saudi Arabia is expected to maintain its position as the largest pharmaceutical market within the Gulf in the foreseeable future. The UAE is also likely to retain its ranking as the second largest pharmaceutical market.

Population growth in the GCC will be a key growth driver for the pharmaceutical sector. Population is anticipated to expand from 37.5 million in 2007 to nearly 50 million in 2017. High levels of urbanization and a strong expatriate presence also support pharmaceutical sales growth in the region. Population aged 60 years and above is projected to increase from 1.9 million in 2012 to 17.8 million in 2050. The elderly population forms a big slice of the overall pharmaceutical spending in the GCC and will also drive growth.

Sedentary lifestyles and increasing life expectancy have led to spread of chronic ailments. Such diseases tend to persist throughout the life of patients, thus entailing higher medical expenditure than sporadic forms of illnesses. Growing income levels and resultantly a higher spending power of people have improved the quality of life and their overall ability to spend on medicines. General health awareness among the residents has also increased.

The GCC governments are providing a number of incentives to boost domestic pharmaceutical production to reduce the reliance on imports. Compulsory medical insurance schemes for locals and expatriates have either been enacted or are in the process of being launched across the GCC. Increased insurance penetration will make healthcare more affordable and prove beneficial for the pharmaceutical industry.

Regional drug makers are benefitting by making generic versions of drugs whose patents have expired. Newer opportunities are likely to emerge as patents on products with worldwide sales of $223 billion expire in the next six years.

[by www.saudigazette.com.sa]

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