Bulgarian pharma market grows 10% y/y in value in Q3, driven by hospital-drug sector

The value of the Bulgarian pharmaceutical market grew in the third quarter (Q3) of 2014 by 10% year on year (y/y) to BGN632 million (USD404 million), reports Central Europe Pharma News, quoting the third-quarter financial report of leading Bulgarian pharmaceutical wholesaler, Sopharma Trading. Although not stated by the source, IMS Health usually quotes market value in terms of end-user prices in Bulgaria. The source reports that the value of the pharmacy market in the third quarter increased 9% y/y to BGN525.590 million, while the hospital-drug market saw more dynamic growth in value terms, up 13% y/y to BGN106.845 million.

The largest pharmaceutical company on the Bulgarian pharmaceutical market in the third quarter in terms of sales value was Novartis (Switzerland), according to the IMS Health data as quoted by Central Europe Pharma News. Novartis reportedly held a 6.5% share of the market's value, and was followed in second place by fellow Swiss major Roche, which held 6.0% of the market's value. In the third position was GlaxoSmithKline (GSK; United Kingdom), with 5.6%; followed by generics major Actavis (US), the largest pharmaceutical producer in Bulgaria, which held a 5.4% share; Bulgarian-owned generics producer Sopharma was in sixth position, with a 4.0% market share. In volume terms, the largest generics producers on the Bulgarian market – Actavis and Sopharma – held the largest market shares, with 14% and 13% respectively.

According to IMS Health data quoted by Central Europe Pharma News, in 2013, the ratio of innovative to generic drugs in Bulgaria in 2013, in terms of sales value, was 52.4% to 47.6%. On this basis, it is calculated that the value of the sales of innovative drugs in Bulgaria in 2013 was BGN1.228 billion, while the sales of generics reached a value of BGN1.116 billion. In volume terms, the ratio was substantially reversed, with generics holding 77.6% of the market, with sales of 201,744,486 packages – an increase of 0.7%; innovative drugs held a 22.4% market share in terms of volume, with 58,072,438 packages sold, an increase of 9.2% y/y.

Dr Evgeni Tasovski of the Bulgarian generics association BGPharma is quoted by Central Europe Pharma News as saying that public spending on healthcare in Bulgaria amounted to BGN3.3 billion in 2013, which represents 4.1% of GDP, while private healthcare spending amounted to BGN2.9 billion, amounting to 3.9% of GDP; he is reported as saying that public drug reimbursement in 2013 amounted to BGN927 million, which represents 33% of the budget of the National Health Insurance Fund (NZOK).

Outlook and implications

In 2013, the Bulgarian pharmaceutical market grew by 6.3% y/y, according to IMS Health data, and so the rate of growth has increased over the course of this year. This is in spite of major changes in the regulatory landscape for pharmaceutical pricing and reimbursement in the country, including the introduction last year of the National Council for Pricing and Reimbursement of Medicinal Products. The growth seen in the third quarter continues the trend of growth in the sales of more expensive, innovative products borne out by the dominance of the market, in value terms, of the two Swiss pharma majors that are heavily involved in the oncology sector. Oncology is one of the sectors that drove the growth of the Bulgarian pharma market last year, and which continues to be a major growth driver this year.

The statistics on healthcare and pharmaceutical expenditure in Bulgaria could be described as paradoxical. Even though pharmaceuticals represented 33% of the NZOK's budget last year, the country still has the highest proportion of private spending on publicly-reimbursed drugs in the European Union; this indicates the low level of overall healthcare spending in the country, with out-of-pocket spending forming a substantial part of the overall pharmaceutical market. However, there is change occurring in Bulgaria, and the amount of public spending on pharmaceuticals is rising more dynamically than in recent years: in 2013, it is calculated that NZOK drug reimbursement spending was up 14.7% y/y (see Bulgaria: 18 September 2014: Bulgaria's outpatient drug reimbursement increases 14.7% y/y in 2013 to USD366 mil.).