Fast Market Research recommends "Japan Pharmaceuticals & Healthcare Report Q2 2014" from Business Monitor International, now available
Boston, MA -- (SBWIRE) -- 03/04/2014 -- Japan's pharmaceutical expenditure forecast has been upgraded marginally on the back of an increase in medical fees. We highlight that its ageing population remains a key driver of increasing demand for pharmaceuticals. From a sub-sector perspective, slow generic drug uptake continues to support the use of patented drugs, while the liberalisation of the over-the-counter medicine sector will also boost pharmaceutical sales. Despite this, the slow-growing economy remains a downside risk to our forecast.
The Japanese Ministry of Health, Labour and Welfare (MHLW) has announced a medical fee revision (effective from April 2014), in consideration of the consumption tax hike. Under Prime Minister Shinzo Abe's economic revitalisation plan, the deregulation council set up by Abe in January 2013 supported the increase in reimbursement prices, stating that it would improve competitiveness in the domestic industry. Following the announcement, BMI has upgraded its forecast for Japan's pharmaceutical market.
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Headline Expenditure Projections
- Pharmaceuticals: JPY10,992.8bn (US$112.17bn) in 2013 to JPY11,220.38bn (US$110.00bn) in 2014; +2.1% in local currency terms and -1.9% in US dollar terms. Forecast marginally upgraded from Q114 due to an increase in medical fees, growth in US terms slightly down due to currency fluctuations.
- Healthcare: JPY45,325.51bn (US$462.51bn) in 2013 to JPY46,836.83bn (US$459.18bn) in 2014; +3.3% in local currency terms and -0.7% in US dollar terms. Forecast is higher than in Q114, US growth is now only slightly down due to currency fluctuations.
Japan's Pharmaceutical Risk/Reward Rating (RRR) score for Q214 remains at 74.5 out of the maximum 100 in our newly improved RRR system. This high score makes Japan the most attractive country in comparison with the other 18 key Asia Pacific markets, followed by Australia (67.0) and Taiwan (65.7). Japan's score is boosted by the large multi-billion dollar drug market (market expenditure score of 18.0 out of 20) and large pensionable population (pensionable population score of 8.0 out of 8), but dragged down by a declining pharmaceutical market (sector value growth score of 0 out of 12) and a declining population (population growth score of 1.0 out of 5). Thus, Japan's ageing population will translate into increased pharmaceutical sales although with relatively low growth prospects over the long term.
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