Taiwan market "Could Double Overnight"

The Taiwanese pharmaceutical market could double overnight in volume terms when the new national health care system, which will cover 100% of the population, is introduced on January 1, 1995, under government plans, says a new study from Pharma Strategy Group, an IMS company based in the UK.

The Taiwanese pharmaceutical market increased by 12% in terms of local currency last year, and 9% when expressed in US dollars, to reach a value of NT$32 billion ($1.2 billion), according to the study, which is entitled Taiwan: A Healthcare System in Transition. Aware of the escalation in demand for and costs of health care provision that will follow its health insurance reforms, the government is taking steps to regulate both the demand and supply sides, such as the creation of a three-tier referral system which will include a 50% co-payment for outpatients, to discourage them from seeking treatment in the country's top-tier hospitals.

Moreover, the drug prescribing and dispensing functions are scheduled to be separated two years after the national health insurance system is introduced, which will result in a shift in the supply chain away from sales to hospitals and clinics and towards the retail sector. The retail pharmacists will therefore become to a far greater extent the focus of company promotional activities, a shift which will be further intensified by positive government encouragement of generic prescribing and substitution, and of prescription to over-the-counter product switching.