U.S. sales of pharmaceuticals will grow this year at the slowest rate on record as the weakening economy compounds other factors hampering the industry, according to a report issued Wednesday.
The U.S. market for prescription drugs – the world's largest – is predicted to grow 1 to 2 percent, to between $287 billion and $297 billion, in 2008, according to research firm IMS Health's annual forecast. That figure is down from the 2- to 3-percent rate the company predicted earlier this year.
Norwalk, Conn.-based IMS has tracked prescription drug sales for 50 years.
Drug sales in the U.S. have steadily slowed in recent years as companies struggle to replace blockbuster medications from the 1990s that have lost patent protection. While pharmaceuticals have been traditionally resilient to economic downturns, reports show consumers are cutting back on prescriptions.
Last week, Pfizer reported U.S. sales of its best-selling drug, the cholesterol pill Lipitor, fell 13 percent in the third quarter. A survey by the Kaiser Family Foundation this month found almost a third of patients have skipped medical treatment in the past year, up from 24 percent in April.
IMS predicts U.S. pharmaceutical sales will remain at the 1- to 2-percent growth rate next year. Global sales are expected to grow at a rate of 4.5 to 5.5 percent in 2009, about the same as this year.
“In many respects, 2009 will reflect the new shape of the global pharmaceutical market, the result of market factors that have gained momentum over the past several years,” Murray Aitken, senior vice president with IMS, said in a statement.
Growth in developing countries such as China, Brazil and India, where demand for improved health care is expected to raise sales between 14 and 15 percent, will continue to outpace increases in developed countries.
The pharmaceutical market's overall size will be eroded by $24 billion worth of drugs expected to lose patent protection next year. Expirations have given a boost to generic drugmakers in recent years as they swoop in to offer low-cost versions at a fraction of the original price.
Still, generic sales in 2009 are forecast to be flat, at about $68 billion, as the increasingly crowded industry forces generic manufacturers to lower their prices, cutting profit margins.
IMS expects new drug approvals to remain at historically low levels, with just 25 to 30 drug launches in 2009. Also, most of those will target rare diseases and have limited sales potential.
Drugs prescribed by specialists are expected to make up nearly 70 percent of total market growth next year, according to IMS, compared with just 2 to 3 percent for drugs prescribed by general practitioners.
U.S. federal regulators have stepped up scrutiny of drugs that target broad patient populations, following widely publicized safety concerns with Merck & Co. Inc.'s painkiller Vioxx and GlaxoSmithKline's diabetes medication Avandia.
In the last month alone, the Food and Drug Administration has delayed decisions on two drugs from Abbott Laboratories (a painkiller and a cholesterol drug), an osteoporosis drug from Pfizer Inc. and a blood thinner from Eli Lilly & Co.