Competition from manufacturers abroad hampers industry revenue.
Melbourne, Australia (PRWEB) May 16, 2013
The Pain Medication OTC Manufacturing industry manufactures pharmaceutical products that focus on pain relief and are available without a doctor's permission. As a country with a high awareness of medication and self-medication uses, domestic demand for OTC pain medication has remained healthy over the past five years. This is despite a cautious consumer environment in which consumers have attempted to focus spending on high-value items.
Local manufacturing operations have struggled to benefit from this trend. According to IBISWorld industry analyst Craig Shulman, “global pharmaceutical manufacturing has shifted production towards Asia, where labour is cheaper and the plants are larger, leading to substantial increases in economies of scale.” With these jumps in production capacity, import competition has increased substantially. Australian operations have to deal with higher wage costs. Consequently, this competition is putting pressure on industry profit margins. IBISWorld expects revenue to decrease at an annualised rate of 2.0% over the five years to 2012-13. In 2012-13, revenue is expected to decline 3.3% to reach $834.4 million.
Over the next five years, these trends are expected to continue. Import competition is expected to provide a strong challenge to local manufacturers. “Global pharmaceutical manufacturers are expected to increase their foothold on the global OTC market, as they take advantage of the growing popularity of OTC medication in developing countries and thus improve their global economies of scale,” says Shulman. These growing markets are also new opportunities for Australian manufacturers, which will still have to combat cheaper production methods in these countries as well.
The Pain Medication OTC Manufacturing industry in Australia exhibits a medium level of market share concentration. The top two companies are Pfizer Australia Holdings Pty Limited and GlaxoSmithKline Holdings Pty Ltd.
Over the next five years, many patents are set to expire, with more products and players expected to enter the Pain Medication OTC Manufacturing industry. Established players are likely to extend the life of their former prescription medications by attempting to shift it into the OTC market, pending confirmation from regulators that the products are safe for widespread use without a doctor's prescription. If this is successful, generic brands are expected to follow soon after.
For more information, visit IBISWorld’s Pain Medication OTC Manufacturing report in Australia industry page.
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IBISWorld Industry Report Key Topics
Companies in this industry research and develop medicines with pain-relieving, anti-inflammatory and other effects. Products manufactured by the industry are available without a prescription in various OTC locations.
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.