Euro Drug Industry "Still World Leader"

The European Union's pharmaceutical industry is still the world leader in production and exports, says the European Commission's Panorama of EU Industry. Total output in the latest reported year, 1992, was 64 billion Ecu ($79.6 billion), of which non-prescription drugs accounted for 20%. Pharmaceuticals was one of the six fastest-growing sectors of EU industry during 1986-92, due to the surge in demand for health services. EU drug consumption was up 4.5% in 1992, and production rose 5% at current prices, with German production up 8.1% and France's rising 7.8%. 1993 production growth across the EU is estimated at 8%.

But things are changing. "As a reaction to declining domestic product prices, the japanese industry is developing new markets in the USA and Europe, and acquiring foreign firms," warns the study. Japanese companies remain "far behind" their counterparts in the USA and Europe in medical research, but are investing heavily to catch up with their foreign competitors. Meanwhile, "although the European pharmaceutical industry remains the world leader (in foreign trade), it has been losing ground to foreign markets."

The shift identified in the report is from strong to moderate growth for prescription drugs. While demand will continue to grow throughout the 1990s, attention to cost-saving will favor cheaper products. Exports and imports will grow at about 5% a year, with biopharmaceuticals growing by about 7%. For over-the-counter products, demand is likely to increase "at a steady pace," supported by company strategy and government regulation.