Market Report, "Greece Pharmaceuticals & Healthcare Report Q4 2012", Published

New Healthcare research report from Business Monitor International is now available from Fast Market Research


Boston, MA -- (SBWire) -- 01/02/2013 --The immediate threat of a Greek default and eurozone exit was reduced as the outcome of the legislative elections in June had a much more benign outcome than many feared. An exit would have - and could still be - disastrous for drugmakers operating in the market. But even Greece staying in the monetary union means the government must continue with its austerity programme. While we continue to hold to our view that Germany and the rest of the EU may reduce the focus on austerity and introduce some pro-growth strategies, these are unlikely to generate any upside for the pharmaceutical industry and structural reforms within Greece will be maintained. The government remains committed to huge cuts in its public drug expenditure for 2012, with a painful claw-back tax in operation and no extra resources available to pay-back existing debts.

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Headline Expenditure Projections

- Pharmaceuticals: EUR6.72bn (US$9.35bn) in 2011 to EUR5.92bn (US$7.52bn) in 2012; -12.0% in local currency terms and -19.6% in US dollar terms. Forecast broadly maintained from Q312.
- Healthcare: EUR21.80bn (US$30.31bn) in 2011 to EUR20.34bn (US$25.83bn) in 2012; -6.7% in local currency terms and -14.8% in US dollar terms. Forecast broadly stable from Q312.
- Medical devices: EUR670mn (US$931mn) in 2011 to EU607mn (US$771mn) in 2012; -9.3% in local currency terms and -17.1% in US dollar terms. Forecast unchanged from Q312.

Risk/Reward Rating: In our latest RRRs, we have revised down our assessment of the Greek market, with a downgrade to the industry risk score as a result of broadly unfavourable operating conditions worsening, specifically re-payment terms, which we have criticised previously, and our assessment of whether innovative drugmakers would want to launch new products on the market.

Key Trends And Developments

In addition to huge cost-containment measures imposed by the authorities, drugmakers in Greece are facing immense problems with the payment process. The level of hospital debt, which is historically high and compounded by budget cuts, has meant public hospitals are unable to pay their drug bills. The body responsible for reimbursement, the National Organisation for Healthcare Provision (EOPYY), owes excessively to pharmacies and drugmakers. While it has continued to make payments to pharmacies, these are extremely delayed, creating cash flow issues for financially struggling pharmacists.

In late August 2012, The Pan-Hellenic Pharmaceutical Association in Greece has said its members will not provide drugs on credit to customers insured by the National Organization for Healthcare Provision (EOPYY) from September 1. The association, representing about 12,000 pharmacies, said pharmacists will instead accept only cash for such drugs.

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