Ill at ease: Ongoing PBS price disclosure reforms have negatively affected industry revenue

Firms in the Pharmaceutical Product Manufacturing industry have faced several challenges over the past five years. 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 some of the most profitable drugs in the industry’s history, and reform-driven pricing pressures. On the local front, ongoing reforms to the PBS have been particularly significant, with mandatory price disclosures continuing to reduce prices. Intensifying competition from generic drugs has added to industry more.

Industry Statistics & Market Size
Annual Growth 14-19
Forecast Growth 19-24

Industry Threats & Opportunities

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

    While industry locations are present in all states (but not territories), industry activity is concentrated in Sydney and Melbourne where the majority of multinational companies have chosen to locate to take advantage of the infrastructure provided and market size (as defined by socioeconomic and demographic variables). As at June 2018, Victoria and New South Wales accounted for 66.2% of all business enterprises, suggesting a high degree of geographic concentration. This high degree of concentration has been consistent over the past decade...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 medications
  • Vitamins and dietary supplements
  • OTC 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
  • Volatile performance
  • Manufacturing capacity cuts
  • Reliance on imports
  • Ongoing PBS changes
  • Chart: Revenue Growth

  • Industry Outlook
  • Long-term survival
  • Ongoing consolidation
  • 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 medications
  • Vitamins and dietary supplements
  • OTC 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
  • Chart: Cost Structure Benchmarking – Sector vs Pharmaceutical Product Manufacturing

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

  • Industry Globalization
    GlaxoSmithKline Holdings Pty Ltd, AstraZeneca Holdings Pty Ltd, Aspen Asia Pacific Pty Ltd, Pfizer Australia Holdings Pty Limited, Mylan Australia Holding Pty Ltd,
  • Table: GlaxoSmithKline Holdings Pty Ltd - financial performance
  • Table: AstraZeneca Holdings Pty Ltd - financial performance
  • Table: Aspen Asia Pacific Pty Ltd - financial performance
  • Table: Pfizer Australia Holdings Pty Limited - financial performance
  • Table: Mylan Australia Holding Pty Ltd - 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
  • Industry Revenue (2010-2024)
  • Industry Gross Product (2010-2024)
  • Establishments (2010-2024)
  • Businesses (2010-2024)
  • Employment (2010-2024)
  • Exports (2010-2024)
  • Imports (2010-2024)
  • Wages (2010-2024)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Biological Medicines
  • Biological medicines are those created by biological processes from living organisms as opposed to those that are chemically synthesised.
  • 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.
  • Pharmaceutical Benefits Scheme (Pbs)
  • A Commonwealth Government program that reduces the cost of pharmaceuticals for consumers to a maximum co-payment by subsidising the additional cost.
  • 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 is a comprehensive guide to market size and growth prospects. Our industry reports offer strategic industry analysis of the factors influencing companies, including new product developments, economic, lifestyle and demographic influences, distribution and supply chain factors and pricing issues. Full analysis accompanies our data forecasts to illustrate how the market responds to emerging industry trends.

    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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