Japanese Pharmaceutical Market to Rise to $72 billion by 2021
The pharmaceutical market in Japan is set to rise from around $70 billion in 2016 to $72 billion by 2021, representing a low compound annual growth rate of 0.3%, according to research and consulting firm GlobalData.
The company’s latest report, CountryFocus: Healthcare, Regulatory and Reimbursement Landscape –Japan, states that the Japanese healthcare market is driven primarily by high levels of affordability and access to healthcare facilities. The increasing burden of the elderly population and well-defined regulatory guidelines will drive the growth of the pharmaceutical market in the future. Despite this, growth will be restrained by the patent cliff anticipated in the coming years for high-turnover drugs, focus on generic substitution, and annual price cuts.
The upcoming expiry of key drug patents is set to pressurize the revenues of some major Japanese pharmaceutical companies. For example, Daiichi Sankyo lost its patents on the Olmesartan family of antihypertensive products in the US in late 2016, and expiry will follow in the EU and Japan in 2017. These products accounted for around 28.8% of consolidated revenue in the fiscal year ended March 2016.
In order to reduce the healthcare expenditure burden, the Japanese government is promoting the use of generics as a cost-containment tool. From December 2016, the Ministry of Health, Labor, and Welfare will review drug prices annually instead of once every 2 years, based on the difference between the actual market price and the official price.
Although increasing generic substitution and yearly pricing reviews are likely to restrict growth in the Japanese pharmaceutical market in the future, the government is also working to reduce long regulatory processes faced by pharmaceutical industry in order to expedite the approval of products and improve access to novel therapeutics. This will not only attract foreign companies but also positively influence the healthcare market.
New guidelines allow foreign pharmaceutical companies to use data from Phase III clinical trials performed in regions other than Japan, which has reduced the length of the review process for new drug applications from three years to one.
This report was built using data and information sourced from proprietary databases, primary and secondary research, and in-house analysis conducted by GlobalData’s team of industry experts. 4,000 of the world’s largest companies, including over 70% of FTSE 100 and 60% of Fortune 100 companies, make more timely and better business decisions thanks to GlobalData’s unique data, expert analysis and innovative solutions, all in one platform. GlobalData’s mission is to help our clients decode the future to be more successful and innovative across a range of industries, including the healthcare, consumer, retail, financial, technology and professional services sectors.
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