Germany Pharmaceuticals and Healthcare Industry Update Quarter 3 2012

  • May 2014
  • -
  • Business Monitor International
  • -
  • 134 pages

Includes 3 FREE quarterly updates

BMI View: While the increased consumption of generic medicines will have an impact on the overall
pharmaceutical industry projection for Germany, we note that government measures such as the three-year
freeze on price rises for prescription drugs, as well as the implementation of mandatory discounts of up to
16% on patented drugs, will weigh more heavily on overall pharmaceutical industry growth.

Headline Expenditure Projections
- Pharmaceuticals: Euros 39.68bn (US Dollar 55.15bn) in 2011 to Euros 38.68bn (US Dollar 49.90bn) in 2012;
-2.5% decline in local currency terms and -9.5% in US dollar terms.
- Healthcare: Euros 272.67bn (US Dollar 379.01bn) in 2011 to Euros 279.03bn (US Dollar 359.95bn) in 2012;
+2.3% growth in local currency terms and -5.0% in US dollar terms.
- Medical devices: Euros 14.97bn (US Dollar 20.81bn) in 2011 to Euros 15.63bn (US Dollar 20.16bn) in 2012;
+4.4% growth in local currency terms and a 3.1% decline in US dollar terms.
Risk/Reward Rating: In our Pharmaceutical Risk/Reward Ratings (RRRs) for Q312, Germany is ranked
third in Western Europe, behind Switzerland and the UK. Despite the tough pricing and reimbursement
conditions and the effects of patent expirations, Germany remains one of the largest global
pharmaceutical industries, which will continue to prop up its rewards score.

Key Trends And Developments
- In March 2012, pharmaceutical companies in Germany criticised the Act on the Reform of the Industry
for Medicinal Products (AMNOG). Under the AMNOG, which was introduced in 2011, companies
launching a new drug are required to provide a dossier showing it offers an improvement on
existing treatments. The Federal Joint Committee (G-BA)’s verdict comes after the evaluation of
the drug by the Institute for Quality and Efficiency in Healthcare (IQWiG), which takes about
three months. Firms have said IQWiG’s methodology and estimates about drugs in various
cases have not been correct.
- Bayer released it Q112 results in April 2012. The firm ’s revenues were at the centre of its
guidance for the full year at Euros 36.5bn (US Dollar 47.3bn), and its net income increased by 90% to
EUR2.47bn (US Dollar 3.2bn) on the full-year result for 2010. However, earnings before interest and
taxes, excluding special items for the group, only increased by 12.9% as the industry player had
incurred several large one-off expenses in 2010. In Q411, earnings were diminished by special
charges of Euros 215mn (US Dollar 278.6mn), mainly from restructuring, compared to net special
charges of Euros 954mn (US Dollar 1.24bn) in Q410.
BMI Economic View: The likelihood of a technical recession for Germany has receded considerably and
we see encouraging signs that improved business confidence and expectations could help to push growth
higher in H212. Nevertheless, we continue to err on the side of caution as sentiment remains highly
susceptible to renewed concerns relating to the eurozone debt crisis. We note that fiscal austerity in
Europe and softer demand in emerging industry s will keep economic growth subdued. We therefore remain
below the consensus, projecting real Gross Domestic Product growth of 0.4% in 2012.
BMI Political View: The formation of a majority government by the Social Democrats and the Greens in
Germany’s most populous state of North Rhine-Westphalia will embolden the opposition nationally and
puts Chancellor Angela Merkel and the Christian Democratic Union on the defensive. That said, although
we see scope for a considerable shake-up in policy and personnel at party headquarters in Berlin, we do
not view this election as a major threat to the chancellor’s chances in next year’s general election. With
the junior coalition partner, the Free Democratic Party, continuing to trail in polls and being ejected from
yet another state parliament, a grand coalition under Merkel’s leadership is emerging as the most likely
outcome after the general election in September 2013.

Table Of Contents

Executive Summary .. 5
Industry SWOT Analysis .... 7
Germany Pharmaceuticals And Healthcare Industry Environment and Risk Analysis 7
Germany Political Environment and Risk Analysis ... 8
Germany Economic Environment and Risk Analysis 8
Germany Business Environment SWOT . 9
Pharmaceutical Risk/Reward Ratings 10
Data : Western Europe Pharmaceutical Risk/Reward Ratings, Q312 .... 10
Rewards .. 12
Risks ... 13
Germany - Industry Summary 14
Regulatory Regime . 15
Intellectual Property Developments 16
Intellcetual Property Developments 16
Pricing Regime . 17
Data : Price Build-Up In The German Pharmaceutical Industry .. 18
Pricing Developments . 18
Reimbursement Regime .... 20
Reimbursement Developments ... 21
Parallel Imports 22

Industry Developments .... 23
Epidemiology .... 23
Healthcare Segment .. 24
Healthcare Segment Reforms ... 24
Krankenkassen .. 25
Research and Development . 26
Biotechnology Segment .. 30
Medical Devices Market . 31
Developments In The Medical Devices Market . 32

Market Projection Scenario .. 33
Overall Industry Projection .. 33
Data : Pharmaceutical Sales, from 2008 to 2016 . 34
Key Growth Factors - Market .. 35
Data : Overall Healthcare Expenditure, from 2008 to 2016 36
Data : Government Healthcare Expenditure, from 2008 to 2016 ... 37
Data : Private Healthcare Expenditure, from 2008 to 2016 37
Key Growth Factors - Macroeconomic .... 38
Data : Germany Economic Activity, from 2011 to 2016 . 45
Prescription Drug Industry Projection 46
Data : Prescription Drug Sales, from 2008 to 2016 ... 46
Patented Drug Industry Projection 47
Data : Patented Drug Sales, from 2008 to 2016 ... 48
Generic Drug Industry Projection .. 49
Data : Generic Drug Sales, from 2008 to 2016 51
OTC Medicine Industry Projection 52
Data : OTC Medicine Sales, from 2008 to 2016 ... 53
Medical Device Industry Projection .... 54
Data : Medical Device Sales, from 2008 to 2016 .. 55
Pharmaceutical Trade Projection . 56
Data : Pharmaceutical Trade, from 2008 to 2016 59
Other Healthcare Data And Projections . 60
Key Risks To BMI’s Projection Scenario 60

Competition Overview ... 61
Pharmaceutical Market .. 61
Data : Leading German Pharmaceutical Firms In May 2012 .. 61
Company Developments ... 62
Wholesale Segment .... 62
Wholesale Segment Developments 63
Retail Segment . 64
Retail Segment Developments .. 67
Company Profiles ... 68
Local Firms ... 68
Bayer HealthCare .. 68
Boehringer Ingelheim . 70
Stada Arzneimittel .. 73
Grünenthal ... 76
Merck KGaA 77
Multinational Comapnies . 80
GlaxoSmithKline (GSK) ... 80
Pfizer.. 82
Novartis .. 84
Sanofi . 85
Merck and Co . 87
Data : Population By Age Group, 1990-2020 (‘000) .... 89
Data : Population By Age Group, 1990-2020 (% of total) . 90
Data : Key Population Ratios, 1990-2020 91
Data : Rural And Urban Population, 1990-2020 .... 91
Glossary ... 92
BMI Methodology .... 94
How We Generate Our Pharmaceutical Market Projections ... 94
Risk/Reward Ratings Methodology . 95
Ratings Overview ... 95
Data : Pharmaceutical Business Environment Indicators .. 96
Weighting 97
Data : Weighting Of Components ... 97
Sources ... 97

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