Emerging nations 'will push drug spending above $1trn'

Global spending on pharmaceuticals is expected to break through the $1trillion (£650bn) barrier over the next five years as demand from emerging economies surges, research shows.

Drug sales are expected to grow at between 5 and 8 per cent per year until 2014, taking the total spent to $1.1trn, according to IMS Health, a healthcare industry intelligence group.

Established drugs losing their patent protection in the developing world, combined with stronger demand from these countries, will push up sales by nearly $300bn a year, the group said.

"Patient demand for pharmaceuticals will remain robust, despite the ongoing effects of the downturn being felt in many parts of the world," said Murray Aitken, a senior vice-president at IMS Health. "In developed markets with publicly funding healthcare plans, pressure by payers to curb drug spending will only intensify, but that will be more than offset by the ongoing, rapid expansion of demand in the emerging markets".

IMS expects drug sales in developing nations to grow at between 14 and 17 per cent over the next five years, overshadowing Western markets that will expand at between just 3 and 6 per cent. Despite this surge in emerging economies, IMS Health predicts that the US will continue to be the world's biggest market for healthcare, with a spend of $390bn by 2014.

Forecasts of stronger growth will come as welcome relief to the giants of the pharmaceuticals industry. Companies such as GlaxoSmithKline and AstraZeneca have reported stiffer competition in recent years from makers of generic drugs, who increasingly have used the courts to challenge the patents owned by the majors.

By 2014, drugs whose sales currently total $142bn will face new competition from cheaper generics, according to IMS. In the US, six blockbuster drugs will lose their patent protection by 2012, including GSK's asthma treatment, Advair, and Pfizer's anti-cholesterol pill, Lipitor. GSK and AstraZeneca have ramped up their efforts in emerging markets. David Brennan, the chief executive of AstraZeneca, said recently: "There is no denying the scale of the opportunity these markets present but, like anything else in this industry, it takes a sound strategy and excellent execution." Yesterday, the company said: "Everyone points to population growth in emerging markets, but what is as important is the rising demand driven by increasing middle classes."

Despite the predictions of strong growth, 2010 will see a temporary slowdown. The global market is expected to expand by between 4 and 6 per cent this year – compared with 7 per cent growth last year, when the market was worth $837bn. In 2008, the industry grew by 4.8 per cent.

IMS Health said this year's falls would be triggered by tighter price controls imposed by European governments. It also predicted that certain therapy areas were likely to lead international growth. Its report added: "As pharmaceutical industry research and development programmes adjust to the broad availability of low-cost generic options in many chronic therapy areas, higher growth will occur in those therapy areas where there is significant, unmet clinical need."

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Collections Agent

£14000 - £16000 per annum: Recruitment Genius: This company was established in...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE 40k: SThree: SThree are a global FTSE 250 busi...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + competitive: SThree: SThree are a global FTSE 250 ...

Recruitment Genius: Mortgage Administrator

£20000 - £25000 per annum: Recruitment Genius: We are a vibrant and establishe...

Day In a Page

Migrant crisis: UN official Philippe Douste-Blazy reveals the harrowing sights he encountered among refugees arriving on Lampedusa

‘Can we really just turn away?’

Dead bodies, men drowning, women miscarrying – a senior UN figure on the horrors he has witnessed among migrants arriving on Lampedusa, and urges politicians not to underestimate our caring nature
Nine of Syria and Iraq's 10 world heritage sites are in danger as Isis ravages centuries of history

Nine of Syria and Iraq's 10 world heritage sites are in danger...

... and not just because of Isis vandalism
Girl on a Plane: An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack

Girl on a Plane

An exclusive extract of the novelisation inspired by the 1970 Palestinian fighters hijack
Why Frederick Forsyth's spying days could spell disaster for today's journalists

Why Frederick Forsyth's spying days could spell disaster for today's journalists

The author of 'The Day of the Jackal' has revealed he spied for MI6 while a foreign correspondent
Markus Persson: If being that rich is so bad, why not just give it all away?

That's a bit rich

The billionaire inventor of computer game Minecraft says he is bored, lonely and isolated by his vast wealth. If it’s that bad, says Simon Kelner, why not just give it all away?
Euro 2016: Chris Coleman on course to end half a century of hurt for Wales

Coleman on course to end half a century of hurt for Wales

Wales last qualified for major tournament in 1958 but after several near misses the current crop can book place at Euro 2016 and end all the indifference
Rugby World Cup 2015: The tournament's forgotten XV

Forgotten XV of the rugby World Cup

Now the squads are out, Chris Hewett picks a side of stars who missed the cut
A groundbreaking study of 'Britain's Atlantis' long buried at the bottom of the North Sea could revolutionise how we see our prehistoric past

Britain's Atlantis

Scientific study beneath North Sea could revolutionise how we see the past
The Queen has 'done and said nothing that anybody will remember,' says Starkey

The Queen has 'done and said nothing that anybody will remember'

David Starkey's assessment
Oliver Sacks said his life has been 'an enormous privilege and adventure'

'An enormous privilege and adventure'

Oliver Sacks writing about his life
'Gibraltar is British, and it is going to stay British forever'

'Gibraltar is British, and it is going to stay British forever'

The Rock's Chief Minister hits back at Spanish government's 'lies'
Britain is still addicted to 'dirty coal'

Britain still addicted to 'dirty' coal

Biggest energy suppliers are more dependent on fossil fuel than a decade ago
Orthorexia nervosa: How becoming obsessed with healthy eating can lead to malnutrition

Orthorexia nervosa

How becoming obsessed with healthy eating can lead to malnutrition
Lady Chatterley is not obscene, says TV director

Lady Chatterley’s Lover

Director Jed Mercurio on why DH Lawrence's novel 'is not an obscene story'
Farmers in tropical forests are training ants to kill off bigger pests

Set a pest to catch a pest

Farmers in tropical forests are training ants to kill off bigger pests