Industry players will adopt new business models as key drugs lose patent protection
Melbourne, Australia (PRWEB) January 10, 2013
The Pharmaceutical Product Manufacturing industry is dominated by major global pharmaceutical groups, although only a small number are engaged in secondary or actives manufacturing (active pharmaceutical ingredients), with an increasing number involved in just the later stages of the manufacturing process such as dispensing, packaging and the fill and finish stage. A large number of players also restrict their activities in Australia purely to distribution. In 2012-13, industry revenue is expected to decline by 2.1% as various internal and external factors take their toll. The industry is forecast to generate revenue of $9.34 billion in 2012-13, up by an annualised 0.9% over the past five years. According to IBISWorld industry analyst Kosta Lev, “domestic demand will be greater than revenue in 2012-13, highlighting the dominant role that imports play in the industry”. While the industry is a net importer, it is also one of Australia's largest high-technology exporters.
The industry is deemed to have a medium level of concentration, with the top four players – Pfizer Australia Holdings Pty Limited, GlaxoSmithKline Holdings Pty Ltd, AstraZeneca Pty Limited and Sanofi-Aventis Australia Pty Limited – accounting for a significant share of the local market. “This partly reflects the number of mergers that have occurred in the past few years”, says Lev. Given the highly globalised nature of the industry, this will continue to rise gradually in line with increasing concentration on the world stage.
In the next five years, the Pharmaceutical Product Manufacturing industry is expected to continue its gradual transformation process in view of slight revenue growth, declining research and development (R&D) productivity, increasing competitive pressures and rising safety concerns. Continued global industry rationalisation may also have implications for the level of pharmaceutical manufacturing and R&D undertaken in Australia. The industry will be affected by the expiration of patent protection for some of the world's key drugs between 2011 and 2015. This means that the pressure for change will escalate as major players lose exclusive manufacturing rights to some of the most profitable drugs in history. This will result in the adoption of new business models as industry participants seek to evolve in order to ensure their continued survival.
For more information, visit IBISWorld’s Pharmaceutical Product Manufacturing report in Australia industry page.
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IBISWorld industry Report Key Topics
The Pharmaceutical Product Manufacturing industry comprises companies that manufacture various medicinal and pharmaceutical products, including drugs, medicines (including herbal medicines), medicinal chemicals as well as nappies and feminine hygiene products. Industry products are then either distributed by the manufacturer or via wholesalers to hospitals, pharmacies and other retail outlets such as supermarkets.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Technology & Systems
Regulation & Policy
About IBISWorld Inc.
Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every Australian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Melbourne, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com.au or call (03) 9655 3886.