The report covers the market developments in Q4 2013 for Romania’s pharmaceutical sector. The report also summarizes corporate news for firms including Sanofi, GSK, Farmaceutica Remedia, and Farmexim, among others.

Pharmaceutical sales declined on an annual basis for the second consecutive quarter in Q4 2013, after in Q3 the market dropped in RON terms for the first time in the past seven years, according to our calculations based on available statistics. Pharmaceutical sales also dropped by 3.6% year on year in volume terms and as regards days of treatment.

The pharmaceutical market continued to be affected by the drawback of public support, which also resulted in further deterioration of medicine availability over the quarter. The decrease of medicine sales in H2 2013 affected the full-year market performance. The pharma market inched up 0.3% year on year in local currency and 1.1% year on year when expressed in EUR in 2013, but even though overall sales remained in the positive area, market performance deteriorated sharply compared to the 8.3% year on year rise recorded in 2012 and 12.4% year on year growth in 2011. Notably, in volume terms, pharmaceutical sales declined by 1.1% year on year in 2013, compared to 4.4% year on year growth recorded in 2012.

The OTC segment maintained good performance in Q4 and full year 2013, though the growth eased visibly to 6.5% year on year in 2013 from 12% in 2012 (in local currency). The segment continued to gain market share, reflecting the pharmaceutical companies’ rising interest in developing their OTC portfolios. OTCs accounted for 18.8% of total medicines sales value in Q4 2013 and 17.5% market share in full year 2013, versus 17.6% in Q4 2012 and respectively 16.5% market share in 2012.

Key Points:

• In corporate news, pharmaceutical company Sanofi Aventis estimates that exports reached 30% of the production volume in 2013, double the figure from 2012, and plans to further increase exports to reach 50% in the coming years.

• UK-based medicine producer GlaxoSmithKline (GSK) expects the expiration of the patent for the best-selling drug in its portfolio (Seretide) to reflect in a moderate decline of sales in 2014, below 10% year on year.

• Romanian pharmaceutical distributor Farmaceutica Remedia reported RON 240.6mn (EUR 54.4mn) sales revenues in 2013, up by 1.2% year on year.

• Pharmaceutical distributor Farmexim completed at the beginning of 2014 a EUR 16mn investment in a logistics center in Balotesti, Ilfov county. The logistics center covers over 15,000sqm and can store over 6,000 pellets.

• Pharmaceutical sales are expected to start picking up this year and record an average annual growth of 4.8% by 2018, according to market data.

• The growth rates forecasted for the coming years are below the expansion pace in the past, yet positive projections should in principle support investments in the sector.