A bitter pill: PBS reforms are expected to constrain revenue growth in the current year

Operators in the Pharmaceutical Wholesaling industry are an important link between local and international pharmaceutical manufacturers and Australia's community pharmacies. Pharmaceutical wholesalers procure, distribute and sell a range of pharmaceutical and medicinal products. These products include prescription medicines, pharmacy-only medicines, over-the-counter (OTC) medicines, other healthcare products and veterinary pharmaceuticals.Changes to the industry's operating environment and ongoing reforms to the Pharmaceutical Benefits Scheme (PBS) have constrained the industry's performance over the past five years...read more.

Industry Statistics & Market Size
Revenue
$14bn
Annual Growth 13-18
3.1%
Forecast Growth 18-23
Profit
Employment
13,050
Businesses
1,640

Industry Threats & Opportunities

  • Despite volume gains, falling unit prices have hindered the industry's performance
  • Revenue growth has been subdued, due to regulated price deflation in the industry’s largest product market
  • Some industry players are expected to boost margins through improved stock and logistics management
  • Industry Report - Industry Key Buyers Chapter

    The Pharmaceuticals Wholesaling industry has high concentration. This reflects the dominance of the three largest full-line wholesalers, which are estimated to account for about three quarters of industry revenue.In the case of the prescription pharmaceutical product segment, concentration is even higher, with the three major players accounting for over 80% of total prescription pharmaceutical sales. This high market share concentration is partly a result of regulations governing Community Service Obligation funding that require wholesalers to meet defined standards. PBS medicine wholesalers must be able to deliver pharmaceuticals to any pharmacy in a specified timeframe at (or below) an approved price...purchase to read more.

    Additional Insights for the Pharmaceuticals Wholesaling Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Pharmaceuticals Wholesaling Industry are

  • Having links with suppliers
  • Financial support from a downstream activity
  • Having a clear market position
  • IBISWorld analysts also discuss how external factors such as Federal funding for the Pharmaceutical Benefits Scheme and Demand from pharmacies in the Pharmaceuticals Wholesaling industry impact industry performance..

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    What's in this report

    What is the Pharmaceuticals Wholesaling Industry?

    The industry is made up of companies that wholesale pharmaceutical products, including prescription drugs, over-the-counter medicines and complementary or alternative medicines. It also includes companies involved in wholesaling veterinary drugs and medicines. The products are obtained from upstream manufacturers and distributed to hospitals, veterinarians and retail outlets, such as pharmacies and supermarkets.

    Industry Products
  • PBS pharmaceuticals
  • Other medications
  • Veterinary pharmaceuticals
  • Industry Activities
  • Prescription pharmaceuticals wholesaling
  • Pharmacy-only pharmaceuticals wholesaling
  • Over-the-counter pharmaceuticals wholesaling
  • Complementary or alternative medicines wholesaling
  • Veterinary pharmaceuticals wholesaling
  • 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
  • Demand from pharmacies
  • Population aged 50 and older
  • Health consciousness

  • Current Performance
  • Downward pressures
  • Profitability constraints
  • Chart: Revenue Growth

  • Industry Outlook
  • Regulatory review
  • Ongoing price deflation
  • Changing market conditions
  • Table: Pharmaceuticals Wholesaling Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Pharmaceuticals Wholesaling Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • General Hospitals
  • Supermarkets and Grocery Stores
  • Convenience Stores
  • Pharmacies

  • Key Selling Industries
  • Pharmaceutical Product Manufacturing

  • Products & Services
  • PBS pharmaceuticals
  • Other medications
  • Veterinary pharmaceuticals
  • Chart: Pharmaceuticals Wholesaling Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Community pharmacies
  • Hospital pharmacies
  • Supermarkets and health food stores
  • Other markets
  • Chart: Major Market Segmentation for the Pharmaceuticals Wholesaling Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Profit
  • Purchases
  • Wages
  • Depreciation and other
  • Chart: Cost Structure Benchmarking – Sector vs Pharmaceuticals Wholesaling

  • Basis of Competition
  • Internal competition
  • External competition

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Pharmaceuticals Wholesaling Industry

  • Industry Globalization
    Sigma Healthcare Limited, Ebos Group Limited, Australian Pharmaceutical Industries Limited,
  • Table: Sigma Healthcare Limited - financial performance
  • Table: Ebos Group Limited - financial performance
  • Table: Australian Pharmaceutical Industries Limited - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Pharmaceuticals Wholesaling 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 Pharmaceuticals Wholesaling Industry
    Includes:
  • Industry Revenue (2009-2023)
  • Industry Gross Product (2009-2023)
  • Establishments (2009-2023)
  • Businesses (2009-2023)
  • Employment (2009-2023)
  • Wages (2009-2023)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Community Service Obligation (Cso)
  • A patient-orientated model of distribution that ensures every pharmacy in Australia has access to PBS medicines from nominated wholesalers.
  • F1 Formulary Drugs
  • Single brand drugs listed on the PBS that are not considered interchangeable on an individual patient basis.
  • F2 Formulary Drugs
  • PBS drugs for which there is at least one alternative product considered to be clinically interchangeable. These drugs tend to be medicines where the patent has already expired.
  • Over-The-Counter (Otc) Drugs
  • These medications may be sold directly to consumers without a prescription.
  • Schedule 2
  • Pharmaceuticals sold only in pharmacies.
  • Schedule 3
  • Pharmaceuticals sold only by pharmacists.
  • Section 85 Pbs Medicines
  • This refers to general PBS medicines available in the community as opposed to those distributed under special arrangements through PBS Section 100 programs.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s Pharmaceuticals Wholesaling 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 Pharmaceuticals Wholesaling:
    • 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 Pharmaceuticals Wholesaling 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 Pharmaceuticals Wholesaling, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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