South Korea a 'transitional' pharmaceuticals market, says BMI

In a new report on South Korea's pharmaceuticals and health care industry, Business Monitor International describes the country as a transitional pharmaceutical market. Characteristic of an emerging market, combined sales of prescription drugs and over-the-counter (OTC) medicines are forecast to post high single-digit compound annual growth rates (CAGRs) over the next five years. However, the operating environment is similar to that seen in traditional markets.

South Korea's Pharmaceutical Business Environment Rating (BER) has increased from 66.9 out of 100 in third-quarter 2010 to 67.0 in the fourth quarter, due to a slight improvement in BMI’s evaluation of the Country Risks. Scores for the other main BER sub-categories Industry Rewards, Country Rewards and Industry Risks have remained unchanged from the previous quarter.

However, South Korea has dropped from first to third in the 17-country ratings system, due to improved BER scores recorded by Australia (66.9 to 70.2) and Japan (66.7 to 68.8). Indicative of a developed pharmaceutical market, selling and administrative expenses recorded by drugmakers operating in South Korea dropped in 2009, as the government enforced new rules on illegal rebates and other inappropriate marketing practices.