Drug Sales To Continue Falling
BMI View : The Finnish government will maintain its tough stance on medicine pricing, despite the impact on medicine prices negatively affecting the attractiveness of the country as a destination to sell medicines. During the past decade, medicines wholesale prices have dropped by about 20%, compared with an increase of the same order in the consumer price index. Our bearish outlook also takes into account the challenging state of the economy .
In 2009, sales of medicines totalled EUR2.79bn (US$4.10bn), increasingly only marginally over sales of EUR2.78bn (US$3.57bn) in 2008. In April 2009, a reference price system was introduced in Finland and at the same time generic substitution was extended to cover medicinal products which hold an analogous process patent (products for which generic alternatives, produced with different production methods, are available on the market). We note that legislation also impacted medicine sales in 2006 when wholesale prices of medicines were slashed by 5%, resulting in a 0.2% drop in drug expenditure to EUR2.45bn (US$3.08bn).
In 2010, prices of reimbursable prescription medicines fell by 6.1%. The most marked drop was in the basic reimbursement (eg: painkillers) and lower special reimbursement (eg: hypertension medicine) categories, which both went down by 7.4%. The prices of the medicines in the upper special reimbursement category dropped by 4.2% on average.
In 2011, pharmaceutical expenditure reached a value of EUR2.75bn (US$3.82bn), experiencing a decline of 0.5% in local currency terms. The pharmaceutical wholesale index experienced a 1.6% decline in 2011, while the prices of reimbursable prescription-only medicines dropped by almost 3%. In 2012, we calculate the market will continue to decline to reach a value of EUR2.69bn (US$3.40bn), experiencing a 2.5% fall in local currency terms. By 2016, we calculate the market will be worth EUR2.56bn (US$3.08bn).
Medicine Prices Are Low
Highlighting the challenges faced by drug companies operating in Finland's pharmaceutical market, a report published by the Department of Health, The Pharmaceutical Price Regulation Scheme Eleventh Report To Parliament, shows medicine prices in Finland are significantly lower than those in a number of comparable industrial nations. In 2010, Finland was the third cheapest country in the EU. In 2011, the Finnish prices of reimbursable medicines continued to drop by almost 3%. According to PIF, the proposed cut of the medicine wholesales prices by 5% from the beginning of 2013 will bring Finland's price level under that of Greece, restricting the selection of reimbursable medicines available to patients.
According to the price comparison on February 15 2012 published by the Swedish authority responsible for medicine prices, the Dental and Pharmaceutical Benefits Agency (TLV), the Finnish prescription-only medicine prices were the lowest in the Nordic countries in 2011. The TLV survey included Sweden and 15 other countries in Western Europe. The first part of their survey focused on the 2011 prices of new patented medicines introduced in the Swedish market in 2007-2011. Products included in the reference price system were excluded. The second part of the comparison focuses on the 96 bestselling medicines in Sweden. Both comparisons are made at wholesale prices (the pharmacy purchasing price).
|Hit By Cost Containment|
|Finland Pharmaceutical Market (EURbn)|