1. The Greek pharmaceutical market within the crisis
and
perspectives for the big pharma operating in Greece
Christiana Kaisa
September 2015
2. The Greek Pharmaceutical Supply Chain
• Since 2010, the Greek pharmaceutical market has
been challenged.
• 2010: the first “Economic Adjustment Programme
for Greece” was signed between the Greek
government and the “Troika”.
• Reducing public sector expenses was inevitable.
• Public health expenditure was high.
• Reliable data were available only for public
pharmaceutical expenditure.
• Most of the measures received aimed at
decreasing public pharmaceutical expenditure
Source: Stochasis, 2012.
3. Public Pharmaceutical Expenditure
5,108 4,522 3,750 2,845 2,523
-11.5%
-26.6%
-44.3%
-50.6%
-60%
-50%
-40%
-30%
-20%
-10%
0%
0
1,000
2,000
3,000
4,000
5,000
6,000
2009 2010 2011 2012 2013
%Change
Million€
Years
Public pharmaceutical expenditure 2009 - 2013
Net Public Pharmaceutical Expenditure % Cumulative Change since 2009
Source: IOBE, 2014; PFS, 2015.
Data processing: Christiana Kaisa.
However, the goal of € 2,0 billion set by the “Troika” for 2013 was never met.
4. Reforms in Greece 2010-2015
Reforms in Greece 2010-2015
Policy Reforms Measures
Pricing
Price cuts.
Changes in External Price Referencing system.
Decrease of VAT.
Markup decrease.
Extraordinary Price Review.
Reimbursement
Listing.
Therapeutic Referencing.
Prescribing Process
E-prescription.
Therapeutic Prescription Protocols.
Auditing prescription data.
Generic Use Promotion
Prescribing according to INN.
Minimum percentage of prescribed generics.
Lower prices for generics.
Additional measures
Rebate & Clawback.
Entry fee.
Additional co-payments (€ 1 per prescription).
5. Total Sales in the Greek Pharmaceutical Market
0
100
200
300
400
500
600
2009 2010 2011 2012 2013 2014
MillionUnits
Years
Sales in the Greek Pharmaceutical market (Volume)
Hospitals/ EOPYY pharmacies Pharmacies/ Wholesalers Total
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
9.00
2009 2010 2011 2012 2013 2014
Billion€
Years
Sales in the Greek Pharmaceutical Market (Value)
Hospitals/ EOPYY pharmacies Pharmacies/ Wholesalers
Total
Source: EOF, 2015.
Data processing: Christiana Kaisa
Source: EOF, 2015.
Data processing: Christiana Kaisa
6. Penetration of Sales
68% 68% 69% 68% 67% 65%
11% 11% 10% 10% 10% 9%
21% 21% 21% 22% 24% 25%
0.00%
20.00%
40.00%
60.00%
80.00%
100.00%
2009 2010 2011 2012 2013 2014
%ofTotalsales(involume)
Years
Penetration of patent protected and non - protected
pharmaceutical products
Off-patent In-patent Generics
19.4%
18.7%
17.9%
17.2%
16.4% 16.4%
14.5%
15.0%
15.5%
16.0%
16.5%
17.0%
17.5%
18.0%
18.5%
19.0%
19.5%
20.0%
2009 2010 2011 2012 2013 2014
%ofTotalsales(involume)
Years
OTC medicines sales
Source: OSFE, 2015.
Data processing: Christiana Kaisa.
Source: OSFE, 2015.
Data processing: Christiana Kaisa.
• Off-patent branded medicines use remains high.
• The use of patent-protected medicines is higher
than the EU average (7,6%).
• Generics use remains lower than the goals set
(60%).
• In 2009, OTC medicines use was significant.
• However, their use has decreased despite the
measures received for their promotion.
7. Research and Development (R&D) in Greece
Source: EFPIA, 2012; EFPIA, 2013.
Data processing: Christiana Kaisa.
Greece is Europe’s laggard concerning pharmaceutical R&D.
8. The top 10 pharma companies operating in Greece
Top 10 Pharma Companies (Sales in Value)
Ranking
(2013)
Pharmaceutical Company Nationality
Production in
Greece
1 NOVARTIS Switzerland
2 PFIZER USA
3 SANOFI France
4 ASTRAZENECA United Kingdom
5 GSK PHARMA United Kingdom
6 MERCK SHARP DOHME USA
7 ELPEN Greece a
8 VIANEX Greece a
9 PHARMASERVE-LILLY USA
10
BOEHRINGER
INGELHEIM
Germany a
Source: IMS, 2015.
• 2 Greek companies
• 8 multinational companies
• 3 domestic manufacturers
• 7 importers
9. Market Share of the top 10 pharma companies
55.71% 54.33% 55.43% 56.48%
44.29% 45.67% 44.57% 43.52%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2010 2011 2012 2013
Marketshare
Years
Market Share of Top 10 Pharma in terms of Value
Top 10 Pharma Total Others
Source: IMS, 2015.
Data processing: Christiana Kaisa
• The top 10 pharma companies hold more
than 50% of the total market.
• The market share remained constant
during 2010-2013 indicating the dominant
role of these companies.
10. Sales of the top 10 pharma companies
0 €
50 €
100 €
150 €
200 €
250 €
300 €
350 €
400 €
2010 2011 2012 2013
Million€
Years
Sales of Top 10 Pharma Companies (Value)
NOVARTIS PFIZER
SANOFI ASTRAZENECA
GSK PHARMA MERCK SHARP DOHME
ELPEN VIANEX
PHARMASERVE BOEHRINGER I
-
5
10
15
20
25
30
35
40
2010 2011 2012 2013
Millionpackages
Years
Sales of Top 10 Pharma Companies (Volume)
NOVARTIS PFIZER
SANOFI ASTRAZENECA
GSK PHARMA MERCK SHARP DOHME
ELPEN VIANEX
PHARMASERVE BOEHRINGER I
Source: IMS, 2015.
Data processing: Christiana Kaisa
Source: IMS, 2015.
Data processing: Christiana Kaisa
11. SWOT analysis of the top 10 pharma companies (I)
Strengths
• Pharmaceutical products are unique and necessary. Demand for
medicines is stable and/or increasing.
• Well-established brand names in the Greek market.
• Established relationships with physicians, other healthcare
professionals and patients.
• Well-developed and established distribution channels (wholesalers),
covering wide geographic areas.
• Well-developed retail networks (pharmacies) with wide geographical
coverage along with active promotion by the pharmacist.
• Multinational pharmaceutical companies investing continuously on
R&D and innovation.
• Experienced and well-educated management team, employees and
healthcare professionals.
Weaknesses
• Limited profit margins, due to regulated prices and markups.
• Mandatory provision of credit to wholesalers / pharmacies creating
conditions of precarity.
• Limited R&D and innovation.
• Lack of both foreign and domestic investors.
• High clawbacks and rebate towards Social Insurance Funds.
• High operating costs.
• High salaries.
• High administrative costs.
12. SWOT analysis of the top 10 pharma companies (II)
Opportunities
• Increasing generic medicines promotion and market share in the
domestic market.
• Reforms in the regulatory framework leading to less supervision, less
regulation and deliberation of the OTC market.
• Promotion of new, innovative medicines.
• Greece is in a strategic position permitting exports to other EU state
members and to emerging/developing markets.
• Patent expirations concerning widely used medicines.
• New indications for existing medicines.
• Increasing ageing population.
• High education level of patients permitting Preventative Health
Awareness Campaigns.
• Strengthening of industry’s brand names.
• Appearance of old diseases.
• Science & Technologic advances.
• Reforms concerning salaries decrease and increase of workplace
flexibility.
Threats
• Continuous and aggravating financial crisis.
• Unsustainability on the banking system and capitals control.
• Political unsustainability and ambiguous legislative framework.
• Regular changes in the Regulatory Environment causing pharmaceutical
market unsustainability.
• Continuous effort to reduce Pharmaceutical Expenditure by 1% of GDP.
• Pricing Policy, including price cuts, mistakes etc.
• Reimbursement policy, including increasing negative list and patients’ higher
co-payments.
• Ambiguous prescribing system.
• High Public debt towards companies and delayed payments.
• Further weakening of Social Insurance Funds.
• Insufficient staff and operation of the regulatory authorities, leading to delayed
drug approvals.
• Increasing number of expensive, imported medicines.
• Austerity measures and lack of liquidity in the market.
• Unemployment, leading to increased number of uninsured patients.
• Reduction of population’s income.
• The “Grexit” scenario.