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Growth in Turkey's US$11bn pharmaceutical market looks set to prevail during 2009, despite a projection for strong economic contraction. While multinationals' prospects may be harmed in the short term by exchange rate-related revenue fluctuations, there remains a strong need for increased pharmaceutical and health expenditure, and these will continue to be the core drivers behind local currency growth. On a positive note, the Medicines and Pharmaceutical General Evaluation Committee at Turkey's Ministry of Health approved an average 8% per package price rise for pharmaceuticals from April 2009, which should negate some of the associated forex risks. From 2008-2013, the report forecasts a compound annual growth rate (CAGR) of 8.7%, reflecting Turkey's status as a high value, high potential market.
The country's attractiveness to multinationals is reinforced by the Pharmaceutical & Healthcare Business Environment Rankings for Q309, in which Turkey climbs to third place. Despite pan-regional declines in scores – largely as a result of the global economic downturn – Turkey's strong market dynamics and positive demographics are particular plus points. However, market and country risk scores remain low.
Turkey is listed under the Priority Watch List section of the Pharmaceutical Research and Manufacturers of America (PhRMA) Special 301 Report 2009 submission to the United States Trade Representative (USTR). The PhRMA report notes that progression has been made in transforming the intellectual property (IP) environment in recent years, although challenges in implementing reform remain an issue.
An increasing number of pharmaceutical companies are establishing bases in Turkey, despite the documented regulatory issues. Clinical research is estimated to have grown by up to 40% in 2008, while research and development (R&D) is likely to exceed US$100mn in 2009, according to the Association of Research-Based Pharmaceutical Companies (AIFD). The growing acknowledgment of Turkey's potential is evidenced by a rise in clinical studies being registered. Between 2007 and 2008 the number of trials registered in Turkey nearly doubled, with a mixture of both early- and late-stage research being performed.
The emerging nature of Turkey's healthcare sector is reflected by its disease burden profile. Turkey lost 15,874 disability-adjusted life years (DALYs) to all diseases and injuries in 2008, according to the Burden of Disease Database (BoDD), making the country the fifth least burdened in Central and Eastern Europe (CEE).
However, it is notable that a substantial 24.5% of DALYs were lost to communicable diseases.
Concurrent with economic growth, this profile is likely to change considerably over the next twenty years, with non-communicable diseases accounting for a greater proportion of the burden. On a positive note, it appears that the growing prevalence of non-communicable diseases such as cancer is being tackled by the Ministry of Health, which has implemented a national cancer programme to tackle the 150,000 new cancer cases diagnosed a year.
Turkey Pharmaceuticals and Healthcare Report Q3 2009: http://www.companiesandmarkets.com/r.ashx?id=MTE8D5M0185733
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