Abstract
In BMI’s Business Environment Rankings (BER) for Q409, France remains
ranked 3rd out of the 9
Western European markets surveyed. Despite its
unwavering focus on cost-containment, the country’s
position in the
regional market has improved since Q209, buoyed by high per capita spending on
drugs
and the tradition of high prescribing and usage of medicines.
Additionally, France benefits from a strong
emphasis on its regulatory
environment, although foreign companies have been critical of the
country’s
‘aggressive’ promotion of generics. However,
as the French economy is suffering along with the rest of
the eurozone,
and as a recovery will have to wait until well into 2010, the government is
unlikely to
relinquish its grip on public healthcare expenditure.
Overall, we calculate that France’s pharmaceutical expenditure will rise
from some EUR34.07bn
(US$50.10bn) in 2008 to EUR38.81bn (US$49.12bn) in
2013. This equates to a compound annual growth
rate (CAGR) of 2.64% in
euro terms, although the market value in US dollar terms will suffer from
the
weakening of the euro in the current year. Generic and
over-the-counter (OTC) drugs are expected to
perform better than the
patented segment, which will continue to be the target of
cost-containment.
Generics especially are expected to post a healthy
12.75% CAGR in local currency terms, accounting for
14% of the total
market value in 2013.
In the meantime, in June 2009, France' s third
largest insurance company, AGF-Allianz, signed an
agreement with a
pharmacy grouping (representing a third of the country' s pharmacies) for
the
reimbursement of a number of OTC medicines from the end of the month.
Reimbursement of some 1,000
OTCs indicated for the total of 43 health
conditions (including cough and cold) will be provided for
those citizens
who have signed up for complimentary health insurance. In the coming years, up
to 3,000
more products could be subject to a status switch, which should
lead to both the volume growth of the
OTC market, but also to a higher
degree of price competition, to the detriment of values. However,
previous
experience showed that the prices of some OTCs rose once they were removed
from the
reimbursement list, and therefore the full impact of the recent
developments is yet to be felt.
In terms of company news, French stalwart
Sanofi-Aventis acquired Pfizer' s Diabel manufacturing plant
in Germany,
one of largest state-of-the-art insulin manufacturing plants in the world.
Sanofi' s product
portfolio already includes successful insulin therapies
such as Apidra (insulin glulisine) and Lantus
(insulin glargine), with the
latter also being developed for other indications. Sanofi-Aventis’s
vaccine arm
Sanofi Pasteur recently signed an agreement with Delphi
Genetics for the manufacture of
biopharmaceuticals using the
latter’s StabyExpress technology, with a view to promote its
longer-term
investments in the biotechnological sector. The company is
already a global leader in vaccines, which
may provide it with a welcome
stay in the face of the upcoming patent cliff.
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