Growth For Southern Africa Pharmaceutical Markets In 2014

BMI View: The pharmaceutical markets of Southern Africa are becoming increasingly penetrated by international drugmakers due to their large populations and economic development allowing for better financial and geographical access to healthcare services, and the region's continued heavy reliance on imported medicines. BMI's pharmaceutical expenditure model reveals that Namibia and Angola will experience the fastest local currency increase in medicine sales in 2014 of 13.4% and 11.4% respectively.

BMI forecasts that the pharmaceutical markets of Southern Africa - Angola, Zambia, Mozambique, Namibia, Zimbabwe, Botswana and South Africa - will experience growth in 2014 on the back of investment in healthcare infrastructure, government support for expansion of medical services, foreign direct investment by drugmakers and rising household incomes. The largest market in the region by some way is South Africa, with an estimated value of US$3.5bn in 2013, followed by Namibia (US$264mn), Zimbabwe (US$233mn), Zambia (US$207mn), Angola (US$204mn), Botswana (US$194mn) and Mozambique (US$184mn).

We forecast 2014 growth of 6-14% in local currency terms for all countries in Southern Africa. However, BMI highlights that the foreign drugmakers with no direct presence in the sub-region will have their repatriated US dollar revenues negatively impacted by currency fluctuations in 2014. BMI's Country Risk team estimates that all currencies in Southern Africa (with the exception of Zimbabwe, which has adopted the US dollar) will depreciate against the US dollar next year.

Namibia On Top
Local Currency 2014 Growth Rates In Southern Africa Pharmaceutical Markets

BMI View: The pharmaceutical markets of Southern Africa are becoming increasingly penetrated by international drugmakers due to their large populations and economic development allowing for better financial and geographical access to healthcare services, and the region's continued heavy reliance on imported medicines. BMI's pharmaceutical expenditure model reveals that Namibia and Angola will experience the fastest local currency increase in medicine sales in 2014 of 13.4% and 11.4% respectively.

BMI forecasts that the pharmaceutical markets of Southern Africa - Angola, Zambia, Mozambique, Namibia, Zimbabwe, Botswana and South Africa - will experience growth in 2014 on the back of investment in healthcare infrastructure, government support for expansion of medical services, foreign direct investment by drugmakers and rising household incomes. The largest market in the region by some way is South Africa, with an estimated value of US$3.5bn in 2013, followed by Namibia (US$264mn), Zimbabwe (US$233mn), Zambia (US$207mn), Angola (US$204mn), Botswana (US$194mn) and Mozambique (US$184mn).

We forecast 2014 growth of 6-14% in local currency terms for all countries in Southern Africa. However, BMI highlights that the foreign drugmakers with no direct presence in the sub-region will have their repatriated US dollar revenues negatively impacted by currency fluctuations in 2014. BMI's Country Risk team estimates that all currencies in Southern Africa (with the exception of Zimbabwe, which has adopted the US dollar) will depreciate against the US dollar next year.

Namibia On Top
Local Currency 2014 Growth Rates In Southern Africa Pharmaceutical Markets

One key trend we expect to see accelerate in Southern Africa in 2014 is the influx of foreign generic drugmakers. In light of swifter global generic drug uptake and ongoing economic development in Southern Africa and the wider continent, we believe interest by foreign generic drugmakers in the region, especially Indian companies, through either product launches or direct investment, will accelerate in 2014. Foreign generic drugmakers are seeking to enter the markets in order to capitalise on the long-term commercial potential of the region's high-growth generic drug markets. Additionally, the negative sentiment of developed-state regulatory authorities towards Indian drugmakers due to the latter's series of manufacturing deficiencies witnessed in 2013 will accelerate these companies' geographical interests in more poorly-regulated regions like those of Southern Africa. [1]

The interest by generic drugmakers in Southern Africa was evident in 2013 through Indian company Cipla's acquisition of South Africa's Cipla Medpro and the potential acquisition of South Africa's Adcock Ingram by Chile's CFR Pharmaceuticals. Additionally, India's NRB Pharma signed a lease agreement with Lusaka South Multi-facility Economic Zone Limited in Zambia to establish two pharmaceutical plants for the manufacture of malaria and HIV-AIDS drugs.

[1] Industry Trend Analysis - 'The 2014 Outlook For The Pharmaceutical Industry In The Middle East And Africa' - November 29 2013.

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Sector: Pharmaceuticals & Healthcare
Geography: Africa, United States
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