All foreigners in Chile are amazed by the offer of Drugstore and Pharmacies in Chile. Some people even say that there is almost a 2 blocks walking distance within one and another. Pharmaceutical Industry has undoubtedly become one of the strongest in Chile nowadays.
In Chile there are 2,659 pharmacies, of which about 60% belong to the three major pharmacy chains (Salcobrand, Cruz Verde and Farmacias Ahumada) that concentrate around 95% of the value of sale of medicines.
During 2012 the three major pharmacy chains in the country had incomes on US$1,502 millions with an annual growth of 8.0% compared to 2011. In the last five years, sales grew by 34.1% from US$1,059 million in 2008 to US$1,502 million in 2012.
Regarding the condition of sale of the products, the revenue of prescribed drugs was US$1,152 millions in 2012, while revenue in Over-the-counter (OTC) drugs was US$ 349 millions.
These figures only consider the sale of drugs and not consider the sale of other products such as personal hygiene items toiletries and cosmetics among others.
The condition for selling a drug is defined by the Public Health Institute (Instituto de Salud Pública/ISP) based on their rules and regulations. The products are separated into two groups: OTC drugs and prescribed medicine. The ISP records the existence of 15,411 products classified as medicines, including the same drug in different presentations and concentrations. Of this registry, 2,431 products are OTC drugs, which corresponds to 15.8% of the total; and 12,980 drugs have a condition of sale under prescription, corresponding to 84.2% of the total.
Regarding market share in sales revenue in 2012, the OTC drugs accounted for 23.3%, while the prescription drugs correspond to 76.7% of revenues.
This shows the importance of prescription drugs for pharmaceutical chains, representing more than three quarters of its income. Moreover, the price of prescription drugs is higher than in OTC drugs. The average price of the first reached US$7 per unit and the second was US$4 in 2012. Concerning units sold between 2008 and 2012 there was a slight increase in share of OTC drugs from 35.5% to 36.9%.
Regarding overall evolution of the market for drugs is observed growth around 34.1% in the last five years. Also, the price of drugs in the past five years has risen an average of 23.1%; that is, 26.2% up in prescription drugs and 17.3% in OTC drugs. However, in the last two years we have seen a strongest rise in OTC drugs.
The volume of units sold has presented an upward trend, 9.0% increase in drugs units sold between 2008 and 2012. This increase is mainly explained by an increase of 13.3% in OTC drugs, while prescription drugs grew 6.6%. However, in 2012 we have seen a growth in sales of prescription drugs, which doubled the growth of sales in OTC medicines.
Medicines registered in Chile are divided into 266 therapeutic classes. The therapeutic class that generate higher revenues to the three major pharmacy chains is the female hormone contraceptive with 6.4% of sales for the year 2012. Then non-narcotic analgesic with 3.9%, an antirheumatic 3.8%, antidepressants with 3.4% and dermatological products with 3.1%. these products are relatively common use, but the dermatological products are only sold directly and concentrated 11.7% of such sales.
Other products sold without prescription and represent a percentage significant sales pharmacies OTC drugs are emollients and sun blockers with 11.6%, non-narcotic analgesics with 9.8% and 5.1% Anti-flu medicines.
With all this background, spending on medicines in the country will continue to increase as economic development increases. Today Chile has a per capita expenditure of US$ 82, while in Europe spending reaches US$261 per capita and United States U.S. US$ 1,042 per capita.
Foreign manufacturers such as Indian drugmaker Bal Pharma have a presence in the country. Total imports for 2008 reached $616 million, of which the USA had 13% of the market share, followed by Germany with 9%, France 8%, and China and Brazil both with 7% each. Regarding to the country’s attractiveness to innovative drug companies, Chile stands above Argentina and Peru and below Mexico and Brazil.
By 2014, the report forecasts the Chilean pharmaceutical market could be worth US$1.96 billion, increasing at a compound annual growth rate of 11.31% in US dollars. By 2019, the sale of prescription and OTC drugs will have reached a value of 1,165.35 billion pesos, increasing at a compound annual growth rate of 8.14% in US dollars.
Ministry of Economy, Development and Tourism
Ministerio de Economía, Fomento y Turismo www.economia.gob.cl
The Pharma Letter, www.thepharmaletter.com