New report highlights medicines industry downturn
A new report published by Medicines Australia points to the tough business conditions currently confronting the medicines industry in Australia.
The latest Medicines Australia Facts Book, which contains key industry statistics and other information, shows the medicines industry is facing significant challenges.
The Facts Book reveals:
- Medical sales and service income for the medicines industry fell to $9.718bn in 2010-11, down from $10.021bn in 2009-10 – a decline of 3%.
- The number of new medicines listed on the Pharmaceutical Benefits Scheme fell from 22 in 2010-11 to just 15 in 2011-12.
- The number of Australians employed in the medicines industry declined for the fourth consecutive year, to 13,375; since 2006-07 more than 1300 Australian jobs have been lost from the medicines industry.
- Annual turnover of the Australian medicines industry in 2010-11 grew by just 2%, from $21.95bn in 2009-10 to $22.46bn.
- Annual investment in pharmaceutical R&D grew by just 0.3% per cent, from $1.034bn in 2009-10 to $1.037bn.
- Australia’s R&D investment growth between 2005 and 2010 compares poorly with other markets: 42 per cent, compared with 46 per cent in Africa, 112 per cent in Canada, 303 per cent in India and 455 per cent in Japan.
- Company tax rate in Australia remains five percentage points higher than the OECD average.
- Australia remains well below the OECD average total expenditure on health as a proportion of GDP.
Medicines Australia chief executive Dr Brendan Shaw said the report highlighted the impact of a challenging and unpredictable policy environment.
“There’s no way to sugar-coat it, 2012 was a tough year for the Australian medicines industry,” Dr Shaw said.
“While the industry is still proudly one of Australia’s leading manufacturing export industries, generating over $4 billion a year in exports, the fact is jobs have been lost, clinical trial numbers are down more than 30% over the past six years, sales growth is low, patents on many major medicines are expiring, and the operating environment is generally becoming much tougher.
“Late last year we saw several companies announce over 300 job losses in the industry partly due to the tough PBS operating environment from things like listing delays and major price cuts for patented and off-patent medicines.
“We’re keen to build the Australian industry so Australia can capitalise on our great medical research capability.
“The Australian medicines industry makes a considerable contribution to the national economy, with $4 billion in exports, $1 billion of R&D investment and 13,000 high-value Australian jobs.
“There is an opportunity to protect and grow that economic contribution and to protect and grow Australian jobs. What’s needed is a return to a more predictable and stable policy environment.”
The Medicines Australia Facts Book can be downloaded here
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