Just Released: "Italy Pharmaceuticals & Healthcare Report Q4 2012"

Fast Market Research recommends "Italy Pharmaceuticals & Healthcare Report Q4 2012" from Business Monitor International, now available

by Bill Thompson

(WireNews+Co) - Boston, MA - 28 October 2012

BMI View: We forecast deteriorating prospects for drugmakers in Italy because in addition to a decline in public spending on pharmaceuticals (enforced by price cuts on medicines), company revenue streams are under pressure as hospitals are delaying payments worth billions of dollars. Our bearish outlook takes into account the deteriorating state of the economy and the country's enormous public debt burden, in addition to the high levels of unemployment and the subsequent contraction in private consumption.

Headline Expenditure Projections

- Pharmaceuticals: EUR24.90bn (US$34.63bn) in 2011 to EUR23.54bn (US$29.89bn) in 2012; -5.5% in local currency terms (-13.7% in US dollar terms).
- Healthcare: EUR152.17bn (US$211.63bn) in 2011 to EUR155.47bn (US$197.44bn) in 2012; +2.2% growth in local currency terms (-6.7% in US dollar terms).
- Medical devices: EUR6.42bn (US$8.93bn) in 2011 to EUR6.62bn (US$8.39n) in 2012; +3.0% growth in local currency terms (-5.9% in US dollar terms).

View Full Report Details and Table of Contents (http://www.fastmr.com/prod/464512_italy_pharmaceuticals_healthcare_report_q4_2012.aspx) (http://www.fastmr.com/prod/464512_italy_pharmaceuticals_healthcare_report_q4_2012.aspx)

Risk/Reward Rating: In our Pharmaceuticals and Healthcare Risk/Reward (RRRs) for Q412, Italy is ninth out of the 10 markets surveyed in Western Europe. Despite being a large market, Italy is characterised by low levels of annual growth, largely because of widespread price cuts. Additionally, the Italian economy is one of the most vulnerable economies in an already shaky eurozone. High levels of public debt, poor infrastructure and a lack of competitiveness indicate that the country will remain one of the region's laggards over the forecast period.

Key Trends And Developments

- In July 2012, aimed at lowering the country's budget deficit, the Italian government announced a series of measures to reduce public spending by EUR26bn (US$32bn) over three years. These add up to a cut in fiscal spending of EUR4.5bn (US$5.5bn) in 2012, EUR10.5bn (US$12.9bn) in 2013 and EUR11.0bn (US$13.5bn) in 2014. Aligning with the government's focus on containing costs in the healthcare sector (the government accounts for nearly 80% of total healthcare spending and nearly 90% of total pharmaceutical spending), the EUR26bn austerity package includes measures to decrease healthcare costs.
- On June 26 2012, as part of a series of proposals that look to cut health spending by EUR8bn (US$10bn) over a period of three years, Italy's health minister Renato Balduzzi proposed slashing spending on medicines that are distributed outside hospitals while increasing the amount spent on drugs used inside hospitals.

BMI Economic View: We forecast Italian real GDP to contract by 1.6% in 2012 as government austerity measures and a wider slowdown in the eurozone hit the economy. We expect the economy to return to positive growth in 2013, but we forecast trend growth to remain a modest 1.5% through to 2016.

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