New Market Report Now Available: Kuwait Pharmaceuticals & Healthcare Report Q2 2010

April 13, 2010 - PRLog -- The Kuwaiti pharmaceutical market - now slipping to fifth place from third out of the 17 regional markets surveyed in the Middle East and Africa (MEA) Business Environment Ranking matrix - will record unspectacular growth in the next five years. The rate of this growth will also be offset by inflation and the government's cost-containment policy, focusing on generic reimbursement. Overall, the market is likely to reach around US$508mn at consumer prices by 2013, up from US$377mn in 2008, equal to US$131 per capita, with both figures small in global terms. The market will post a compound annual growth rate (CAGR) of 5.38% in nominal terms, or a slightly higher 6.15% in US dollar terms, While prescription medicines will continue to dominate a lion's share of the overall market, the recent regionwide regulatory changes - notably the recent attempts to draft legislation on alternative and traditional medicines - will stimulate the development of the over-the-counter (OTC) segment, although it will still remain small in absolute term. Other segments of the healthcare market are also severely limited by the small size of Kuwait's population. Nevertheless,  BMI expects the medical device sector to grow over the coming years, supported by government's strategy to continue undertaking reforms in the healthcare sector as well as partially by the efforts of Kuwaiti distributers seeking new suppliers. We estimated that the market was worth US$78.7mn in 2008, with the figure forecast to top US$98.1mn in 2013, growing at a CAGR of some 3.74% in nominal terms. Given that imports meet virtually all of the demand, foreign companies and their local distributors will be the beneficiaries of this trend. The recent purchase by the Kuwaiti government of nuclear radiation protection drugs, amid concerns of a fallout of a possible conflict between Israel/the US and Iran, or a meltdown of the soon-to-be-operational Iranian Bushehr nuclear power plant, may also lead to purchases of radiation detection and similar medical devices. In the meantime, the Kuwaiti government is under increasing pressure to deal with the economic turmoil, and, as parliament becomes even angrier with the government, this could lead the latter to make some potentially damaging decisions. There is also a risk of early elections: new polls are not due until 2012, but Kuwait has a history of dissolving governments. While we would not expect this to result in any meaningful change of government - parliament is already dominated by the opposition and the royal family is not about to be overthrown - it could destabilise the country, delay reforms, deter investors and lead to even further fiscal laxity. Nevertheless, although Kuwait faces substantial structural challenges over the long-term, the energy sector will continue to grow in real terms to 2018, keeping the government in surplus.

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