BMI's Executive Summary

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The Croatian market is small and behind many of its regional neighbours, despite its relatively advanced status. At more than 70% by value, generics – comprising mostly relatively expensive branded generics – meet the bulk of demand for pharmaceuticals, with the segment continuing to be boosted by healthcare debts, cost-containment initiatives and the support for the strong domestic generics industry in the face of distinct intellectual property (IP) deficiencies.

As in many of its regional peers, prescription medicines in Croatia account for an estimated 85% of the market, largely reflecting the underdeveloped primary care network and the status of medical professionals in the country. The aim of joining the European Union (EU) in as early as 2009 or 2010 will stimulate healthcare system reform in Croatia, gradually leading to the development of a more comprehensive primary care network. Cost-containment pressures will similarly stimulate the growth of an over-the-counter (OTC) market, although the cost-consciousness of consumers will act as a brake on the sector's value development.

In BMI's new Q108 Business Environment Rankings for the major 15 Central and Eastern Europe (CEE) markets, Croatia is found in joint twelfth place, alongside Lithuania, and above only Ukraine and Serbia. The current situation, therefore, is not judged particularly favourable for conducting business in the country, with other markets viewed as offering more commercial potential to multinationals. However, Croatia's removal from the Office of the US Trade Representative (USTR)'s 2007 'Special 301' report, focusing on countries in violation of intellectual property rights (IPRs), indicates a definite improvement in the country's operating conditions.

In the meantime, the local industry remains strong. Pliva, recently acquired by US Barr, is the dominant local player, commanding around a quarter of total generics sales in the country. The acquisition will improve Pliva's access to foreign markets and the US in particular. In the meantime, foreign direct investment (FDI) is discouraged by the country's severe healthcare debt and delays in payments, although the government has relaxed its notoriously difficult reimbursement list inclusion policy somewhat in recent months, including more foreign-made drugs.

Contents

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Chapter 1 - Executive Summary

Croatia Pharmaceuticals Industry SWOT

Croatia Political SWOT

Croatia Economic SWOT

Croatia Business Environment SWOT

Chapter 2 - Business Environment Rankings

Table: Central & Eastern Europe Pharmaceuticals Business Environment Ranking

Business Environment Ranking

Economics - Long-Term Risk

Politics - Long-Term Risk

Regulatory Barriers

Domestic Sector Threat

Market Growth Potential

Market Size Ranking

Chapter 3 - Market Summary

Chapter 4 - Regulatory Regime

Table: Croatian Product Approvals in 2006

Intellectual Property Regime

IP Deficiencies

Pricing & Reimbursement Regime

Healthcare System Deficit

Recent Pricing & Reimbursement Developments

Other Industry Developments

Chapter 5 - Industry Trends And Developments

Health Status

Table: Top 10 Causes of Death

Healthcare Expenditure

Healthcare Reforms

Domestic Pharmaceutical Industry

Foreign Company Activity

R&D Sector

Chapter 6 - Industry Forecast Scenario

Overall Market Forecast

Table: Drug market indicators

Key Growth Factors - Industry

Table: Health expenditure indicators

Key Growth Factors - Macroeconomic

Table: GDP, Output and Population

Prescription Market Forecast

Table: Hospital Sourced Drug Market Indicators

Table: Hospital Sourced Drug Market Indicators

OTC Market Forecast

Table: OTC Market Indicators

Generics And Branded Market Forecast

Table: Generics And Branded Market Indicators

Export/Import Forecasts

Table: Sectoral Trade Indicators

Key Risks To BMI's Forecast Scenario

Chapter 7 - Country Snapshot: Croatia Demographic Data

Section 1: Population

Table: Demographic Indicators (2005)

Table: Rural/Urban Breakdown

Section 2: Education & Healthcare

Table: Education

Table: Healthcare: Vital Statistics

Table: Healthcare: Expenditure

Section 3: Labour Market And Spending Power

Table: Employment Indicators

Table: Consumption and Stratification

Table: Wages per year

Chapter 8 - Competitive Landscape

Table: Market Shares of Leading Companies (2004)

Chapter 9 - Foreign Company Profiles

GlaxoSmithKline

Pfizer

Sanofi-Aventis

Novartis

Merck & Co

Krka

Chapter 10 - Indigenous Company Profiles

Pliva

Belupo

Chapter 11 - BMI Forecast Modelling

How We Generate Our Industry Forecasts

Technical Process

Pharmaceutical Industry

Sources

Chapter 12 - Appendix: Regional Demographic Data

Wages (Ave Labour Force Per Annum), US$ PPP

Population

Household Spending Per Capita, US$

Private Consumption Per Capita, US$ PPP

Market Size, GDP, US$bn

Competitive Landscape for Europe Pharmaceuticals and Healthcare: Sample of Companies Ranked

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Cross-border analysis of regulatory systems comparing the patenting environment, summarising regional pricing and reimbursement factors and monitoring the growth of the Pharmaceuticals sector across the region. Company SWOTs cover leading multinational and national drug companies operating in each market.

Network of European Pharmaceutical & Healthcare Sources

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BMI's Pharmaceuticals & Healthcare Reports are based on an extensive network of multilateral organisations, government departments, pharmaceutical & healthcare industry associations, chambers of commerce and company reports. Information sources include: