New healthcare legislation has boosted demand for prescription drugs, bolstering revenue.
New York, NY (PRWEB) August 09, 2014
The role of the Pharmaceuticals Packing and Labeling Services industry has expanded significantly over the past five years in response to stringent government regulations that have increased pharmaceutical manufacturers' outsourcing of packaging and labeling services. Increasingly pressured to more quickly deliver innovative drugs to market, many pharmaceutical manufacturers are outsourcing their noncentral components (e.g. packing and labeling) to third parties to focus on their core competencies. Additionally, growing use of drug therapies, an aging American population and expanded access to healthcare have stimulated demand for pharmaceuticals during the past five years, bolstering demand for industry services. As a result of these trends, Pharmaceuticals Packing and Labeling Services industry revenue is expected to rise an annualized 3.3% during the five years to 2014, to $1.6 billion, including an increase of 3.8% in 2014.
According to IBISWorld Industry Analyst Lucas Isakowitz, “The Patient Protection and Affordable Care Act of 2010 (PPACA) has spurred industry growth during the past five years. According to the Congressional Budget Office (CBO), since its singing in 2010, the PPACA has increased the number of Medicaid insured individuals by 8.0 million. Similarly, due to the PPACA, coupled with the improving economy, the number of Americans with private health insurance has grown at an annualized 1.3% during the past five years. As individuals with health insurance have a 75.0% higher drug use rate and tend to spend more on prescription drugs than uninsured individuals (according to US government statistics) healthcare reform has stimulated downstream demand for pharmaceutical manufacturers, which ultimately increases demand for packaging and labeling services.
“Expanded access to health insurance and healthy demand for pharmaceuticals will continue to underpin industry performance over the five years through 2019,” says Isakowitz. According to the CBO, the initiatives that the 2010 healthcare reform have pushed are expected to provide 26.0 million previously uninsured individuals with coverage by 2024. This will stimulate demand for pharmaceuticals, ultimately translating into high demand for packaging and labeling services. Additionally, growing importance of tamper-proof, anticounterfeiting packaging will keep demand high for industry services.
For more information, visit IBISWorld’s Pharmaceuticals Packing and Labeling Services in the US industry report page.
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IBISWorld industry Report Key Topics
The Pharmaceuticals Packing and Labeling Services industry provides packing and labeling services for prescription and over-the-counter pharmaceuticals, biologics, consumer health and veterinary products. Packing and labeling may be provided for finished drug products or active pharmaceutical ingredients. Industry services may include packaging into blisters, bottles, pouches and unit doses, specialty vial or syringe labeling and kitting for injectables.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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