A new report predicts the overall pharma market in China will reach $158bn in 2016. The market generated $88bn in 2012 and its revenues will show strong growth to 2023. That forecast and others appear in Chinese Pharmaceutical Market 2013-2023, published in April 2013.
That study predicts double-figure expansion in all sectors of the Chinese pharmaceutical market, with rural sales outlets particularly benefitting from the government’s investment in healthcare. Biologics (biological drugs) will increase their market share, driven by biosimilar uptake, while sales of novel biologics will be stimulated by innovations such as Roche’s private insurance scheme for Herceptin. China’s under-met needs in chronic disease areas will continue to stimulate healthcare spending, with cancer treatments replacing anti-infective agents as the largest market segment before 2020.
Recent governmental reforms have not been uniformly beneficial for the pharma industry, the report indicates. Implementation of the ‘Anhui model’ has spread, and has reportedly forced down drug prices by up to 35%. Questions also remain over technology transfer in the pharmaceutical sector as China moves towards becoming an innovator. Also, future tensions are likely between China’s national development imperatives and the needs of healthcare industries covered in the study.
Dr James Evans, a pharmaceutical industry analyst, said: “While China presents challenges in terms of the government’s role, the size of the country and its variable levels of infrastructure, difficulties over IP, transparency, regulation, and so on, the worldwide pharma industry feels impelled to enter and expand in the Chinese healthcare market.
“China’s disease burden is vast and growing, and in every area there are unmet medical needs that international pharmaceutical companies can address. The big multinationals have already committed to China by building up their sales forces there – there are now more boots on the ground in China than there are even in the US. Furthermore, the pharma industry continues to relocate manufacturing and research operations to China, cutting costs and also helping to get a foothold and win influence there. Projects like AstraZeneca’s Innovation Center China and Sanofi’s China Initiative for Diabetes Excellence are about differentiating therapies for the Chinese market, creating China-specific approaches. That’s worth doing when it’s China you’re doing it for – a country with a vast, idiosyncratic market with great commercial potential remaining.
“We also see companies like GSK and Novartis looking at traditional Chinese medicines (TCM), which may be an if you can’t beat ‘em, join ‘em decision. Anyhow, China’s output of TCM is growing rapidly, especially as the government has kept TCM at the centre of its Twelfth Five-Year Plan. Therefore, TCM isn’t receding. It looks like Big Pharma is now acknowledging it has to be in that segment too, to have a portfolio that will work in China."
Our study concludes that the Chinese market will remain at the centre of the worldwide pharma industry’s growth strategies to 2023, with companies continually adapting to China’s challenges and opportunities.
That new investigation shows revenue forecasts to 2023 at overall national market and submarket level. The analyses cover small-molecule drugs (including generics), TCM, biologics (including biosimilars), medical devices and outsourced pharma activities.