Chill pill: Ongoing PBS price disclosure reforms have weakened the industry's performance

Several favourable demand factors have affected the Pharmaceutical Product Manufacturing industry over the past five years, including an ageing population and a greater incidence of chronic disease. Increased local and global demand for consumer healthcare products has also benefited some industry operators. However, the industry has also faced several challenges over the period. Echoing trends in global pharmaceutical manufacturing, these challenges have included a changing regulatory and risk environment, a patent cliff that has taken away players' exclusive manufacturing rights to many highly profitable drugs, and reform-driven pricing pressures. Locally, ongoing reforms to the PBS have heavily influenced the industry as mandatory price disclosures have continued to reduce prices...read more.

Industry Statistics & Market Size
Revenue
$11bn
Annual Growth 15-20
-0.1%
Forecast Growth 20-25
Profit
Employment
14,872
Businesses
446

Industry Threats & Opportunities

  • Regulatory changes have offset favourable demand trends and higher export revenue
  • The industry highly depends on imported products, including active ingredients
  • Ongoing deflationary pricing pressures are forecast to constrain industry revenue growth
  • Industry Report - Industry SWOT Analysis Chapter

    The Pharmaceutical Product Manufacturing industry has undergone rationalisation over the past decade, due to dramatic changes in its operating environment on both a local and global scale. Global and local players have faced rising costs, falling research and development (R&D) productivity, increasing safety concerns, intensifying generic competition and increased risks. In response, global players have been increasingly rationalising operations as the previous business model, which involved vertically integrated pharmaceutical giants developing blockbuster drugs, became increasingly unviable. As more traditional industry operators have sought to adapt to the new conditions, Australian players have also had to alter their operations. Sev...purchase to read more.

    Additional Insights for the Pharmaceutical Product Manufacturing Industry

    IBISWorld has determined the most important Key Success Factors for the Pharmaceutical Product Manufacturing are:

  • Economies of scale
  • Establishment of brand names
  • Having technology sharing arrangements with major players
  • IBISWorld analysts also discuss how external factors such as Federal funding for the Pharmaceutical Benefits Scheme and Population aged 50 and older in the Pharmaceutical Product Manufacturing industry impact industry performance..

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    What's in this report

    What is the Pharmaceutical Product Manufacturing Industry?

    The industry comprises companies that manufacture medicinal and pharmaceutical products for human use from both synthetic (chemical) and natural sources. Other products include chemical or diagnostic testing agents, blood serums and biotech products. Industry activities include manufacturing active pharmaceutical ingredients and synthesising chemical ingredients, late-stage packaging and fill-finish activities.

    Industry Products
  • Benefit-paid pharmaceuticals
  • All other pharmaceuticals
  • Vitamins and dietary supplements
  • Over-the-counter medicines
  • Other complementary medicines
  • Industry Activities
  • Antibacterial, antibiotic and antitoxin
  • Vaccine
  • Vitamin product
  • Herbal drug
  • Ampoule, medicinal capsule, medicinal ointment and vial
  • Biotechnological pharmaceutical and medicinal products
  • Serum and blood serum
  • Diagnostic substance
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Federal funding for the Pharmaceutical Benefits Scheme
  • Population aged 50 and older
  • Health consciousness
  • Trade-weighted index

  • Current Performance
  • Chart: Revenue Growth

  • Industry Outlook
  • Table: Pharmaceutical Product Manufacturing Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Pharmaceutical Product Manufacturing Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • General Hospitals
  • Pharmaceuticals Wholesaling
  • Pharmacies

  • Key Selling Industries
  • Adhesive Manufacturing
  • Cosmetics, Perfume and Toiletries Manufacturing
  • Packaging Services
  • Soap and Cleaning Compound Manufacturing

  • Products & Services
  • Benefit-paid pharmaceuticals
  • All other pharmaceuticals
  • Vitamins and dietary supplements
  • Over-the-counter medicines
  • Other complementary medicines
  • Chart: Pharmaceutical Product Manufacturing Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Export markets
  • Wholesalers
  • Hospitals and pharmacies
  • Other retailers
  • Chart: Major Market Segmentation for the Pharmaceutical Product Manufacturing Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Profit
  • Wages
  • Purchases
  • Depreciation
  • Other Costs
  • Chart: Cost Structure Benchmarking – Sector vs Pharmaceutical Product Manufacturing

  • Basis of Competition
  • Internal competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Pharmaceutical Product Manufacturing Industry

  • Industry Globalization
    AstraZeneca Holdings Pty Ltd, GlaxoSmithKline Holdings Pty Ltd, Aspen Asia Pacific Pty Ltd, Pfizer Australia Holdings Pty Limited,
  • Table: AstraZeneca Holdings Pty Ltd - financial performance
  • Table: GlaxoSmithKline Holdings Pty Ltd - financial performance
  • Table: Aspen Asia Pacific Pty Ltd - financial performance
  • Table: Pfizer Australia Holdings Pty Limited - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Pharmaceutical Product Manufacturing Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Pharmaceutical Product Manufacturing Industry
    Includes:
  • Industry Revenue (2011-2025)
  • Industry Gross Product (2011-2025)
  • Establishments (2011-2025)
  • Businesses (2011-2025)
  • Employment (2011-2025)
  • Exports (2011-2025)
  • Imports (2011-2025)
  • Wages (2011-2025)
  • Wages (2011-2025)
  • Purchases (2011-2025)
  • Profit (2011-2025)
  • Depreciation (2011-2025)
  • Rent (2011-2025)
  • Utilities (2011-2025)
  • Other (2011-2025)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Biosimilars
  • Biosimilars are a biological medical product that is a copy of an original biologic product. They can be known as follow-on biologics.
  • Blockbuster Drugs
  • Products generating annual sales of $1.0 billion or more.
  • Edetailing
  • Information-technology supported promotional activities.
  • Over-The-Counter (Otc)
  • Refers to products that can be obtained from a pharmacy or chemist without a prescription.
  • Patent Cliff
  • Refers to the potential fall in revenue following the patent expiration of key products.
  • Price Disclosure Reforms
  • These are designed to progressively reduce the price of those PBS medicines subject to competition.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s Pharmaceutical Product Manufacturing market research report can be used to help you: understand market size and growth potential; major companies; draft business plans and pitch books; and conduct benchmarking and SWOT analysis. Our industry analysis highlights macro industry trends in the overall sector and micro trends faced by companies that do business in the industry. The industry report also provides key industry statistics and 5-year forecasts to anticipate future industry prospects so you can decide with confidence.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Pharmaceutical Product Manufacturing:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Pharmaceutical Product Manufacturing market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Pharmaceutical Product Manufacturing, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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