The Japanese pharmaceutical market is forecast to moderately increase from $70bn in 2016 to $72bn by 2021, according to a report by GlobalData.
Titled ‘CountryFocus: Healthcare, Regulatory and Reimbursement Landscape –Japan’, the report states that the market will witness a low compound annual growth rate of 0.3%.
The Japanese healthcare market is characterised by high levels of affordability and easy access to healthcare services.
Primary factors to drive the market growth during the forecast period will be the increasing burden of the elderly population and regulatory guidelines of the country.
The factors that will restrain growth, however, will be the expiry of patents of high-turnover drugs in the future, resulting in generic substitutes and annual price cuts. Patent expiry is further expected to affect the revenues of some of the major pharmaceutical companies in Japan.
For example, the patents for Daiichi Sankyo’s Olmesartan family of anti-hypertensive products in the US expired in 2016 and are due for expiry in the EU and Japan this year. The products accounted for 28.8% of the company’s revenues in 2016.
Patent expiries will increase generic substitution, which is also being promoted by the Japanese government to control prices and reduce the burden of healthcare expenditure. In addition, the Ministry of Health, Labor and Welfare has announced plans to review drug prices annually from December 2016, instead of once every two years.
The government also plans to issue new regulatory guidelines to expedite the approval process of products and increase access to novel therapeutics. Some of the guidelines include the use of data from Phase III clinical trials carried out in regions other than Japan. The guidelines are not only expected to attract foreign companies, but also drive growth in the market.