Lately, China has imposed a price cut to pharmaceutical products sold by some of the world's top pharmaceutical companies. Despite this price cut, pharmaceutical companies are still positive as China has recently expanded the country's state insurance which could mean a bigger and more lucrative market for said companies.
In the past few years, China has been one of the world's top consumers of pharmaceutical products. As such, the industry has responded by focusing their strategy on the world's second-largest economy.
Despite China's decision to cut the price of imported pharmaceutical products, two of the largest overseas pharmaceutical companies operating in the country still posted positive growth last quarter compared to their previous year's performance.
Recent figures reveal that AstraZeneca and Pfizer have both improved their sales in China by as much as 24 percent last quarter. This is a highly positive growth, especially when considering the fact that China started to cut the price of some pharmaceutical products and also behind the ongoing trade war between China and the U.S.
In terms of European industries operating in China, pharmaceutical companies have posted the most positive return. The European Union's Chamber of Commerce based in China reported an 83 percent optimistic growth when it comes to pharmaceutical products.
In terms of sales, China's pharmaceutical market generated a total of $123 billion in 2017. This figure is based on the findings of LEK Consulting, a London-based analytics firm. The firm also predicts that the market will steadily grow at a pace of 5 percent per year up to the year 2022. This growth can be traced to the increasingly wealthy and aging Chinese demographic which are becoming more susceptible to chronic diseases like cancer.
Multinational pharmaceutical companies have seen a steady growth in China by selling off-patent branded drugs. These drugs have found a local following as domestic companies could not match the quality of these branded drugs. In terms of market size, China is Pfizer's third largest market, next to the U.S. and Japan.
Some market analysts are still positive that despite the bitter trade war between China and the U.S. there will be a silver lining. Some are positive that there are still untapped industries in the Chinese market. These industries will be discovered should the current economic mood continues.
