Global spending on pharmaceuticals is expected to surpass $1 trillion for the first time next year, propelled in large part by the rising demand for cheap generic drugs in China and other emerging markets, according to a new forecast from the IMS Institute for Healthcare Informatics.
More than two-thirds of all pharmaceutical drug spending occurs in eight countries: the U.S., Germany, France, Italy, Britain, Spain, Japan and China, the institute found.
Still, the next five years will see two starkly different trends in pharmaceutical consumption, according to the global forecast.
The U.S. will continue to lead the world in per-capita spending on pharmaceuticals, largely because of its heavy reliance on expensive, brand-name drugs, the institute predicts.
However, the rate of growth in drug spending in the U.S. and the rest of the developed world will continue to slow as generics gain traction and, in Europe, as austerity measures imposed in response to the economic slowdown take hold.
In China and other developing countries, on the other hand, drug spending is expected to grow rapidly as economic fortunes improve, the middle class expands and governments invest in broader access to healthcare.
Although patients in the developing world are primarily buying generic drugs, which sell for a fraction of the price of name-brand versions, the increasing use of pharmaceuticals across large populations is driving a surge in drug spending, the institute found.
As consumers everywhere stretch their medical dollars, the institute projects that spending on generic drugs will rise over the next five years from 27% to 36% of the total.
The institute also said the drug pipeline includes innovations in the treatment of rheumatoid arthritis, cystic fibrosis, melanoma and prostate cancer.
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