While the upward trend is a positive sign, it remains below the levels of confidence seen in 2022
The biopharmaceutical industry is showcasing increasing optimism regarding its growth prospects over the next 12 months. While the upward trend is a positive sign, it remains below the levels of confidence seen in 2022, finds GlobalData.
In a recent GlobalData’s survey*, “The State of the Biopharmaceutical Industry 2024 (mid-year update)”, 73 per cent of surveyed healthcare industry professionals felt optimistic or very optimistic about the industry’s growth during the next 12 months, up by 13 per cent from the data received six months ago (60 per cent) and up a further 13 per cent from 2023 (47 per cent), but still below the levels seen in 2022 (81 per cent).
Urte Jakimaviciute, Senior Director of Market Research and Thematic Intelligence at GlobalData, comments, “Despite the ongoing challenges in the geopolitical landscape, there is a gradual decline in inflation, which provides a more stable environment for biotech funding to show signs of recovery, signalling renewed confidence. Supply chain disruptions that plagued the pharmaceutical industry during the past few years are becoming less intense. This gives hope that the industry is on the path of rebounding from the impact of the COVID-19 pandemic and subsequent geopolitical conflicts.”
In the same survey, GlobalData found that from macro and regulatory trends, healthcare industry professionals indicated that geopolitical conflicts and drug pricing and reimbursement pressures will be the main hindrances for the pharmaceutical sector’s growth in the next 12 months.
Jakimaviciute continues, “Geopolitical conflicts and tensions have become potent disruptors casting uncertainty over international relations, investment, and supply chains. Pricing and reimbursement pressures have a direct impact on pharma’s profitability and investments. For example, the Inflation Reduction Act (IRA) that aims to reduce drug prices in the US, introduced government price negotiation for selected pharmaceuticals, with companies refusing to participate in pricing negotiations facing steep penalties.”
“While the current respondents’ sentiment is promising and indicative of potential growth, geopolitical uncertainties coupled with drug pricing and reimbursement pressures remain influential factors that may impact investment confidence and growth prospects,” he adds.
* GlobalData’s survey fielded with 124 healthcare industry professionals globally from April 4, 2024 to May 10, 2024