The European pharmaceutical drugs market consists of prescription and OTC drugs that are used to treat various diseases in humans. Some key drug types in this market include analgesics, anti-infective, diabetes, oncology, cardiology and CNS drugs. The pharmaceutical drugs industry has witnessed strong growth over the past few years owing to the increasing prevalence of chronic and lifestyle diseases along with the growing aging population in European countries. Pharmaceutical drugs provide treatment and help manage the symptoms for diseases like cancer, diabetes, cardiovascular diseases and neurological disorders.
European Pharmaceutical Drugs Market is estimated to be valued at US$ 207.6 Bn in 2024 and is expected to exhibit a CAGR of 10% over the forecast period 2024 To 2031.
Key Takeaways
Key players operating in the European pharmaceutical drugs market are Bank of China, China Development Bank, European Investment Bank, Natixis, Societe Generale, Iberdrola, Banco Santander, Abu Dhabi Islamic Bank, KfW, BNP Paribas, UniCredit, Credit Agricole, DBS Bank, Standard Chartered, NatWest Group. The demand for pharmaceutical drugs in the European region has been increasing over the past few years driven by the growth in the incidence of various chronic diseases as well as the rising aging population. Major European countries like UK, Germany, Italy, France and Spain have been witnessing high demand for drugs due to their developed healthcare infrastructure and expanding patient pool. The key players in the market have been expanding their production facilities and distribution networks across major European countries to cater to the rising local demand.
Market Drivers
A significant driver for the European Pharmaceutical Drugs Market Demand has been the rapid growth of the aging population. The proportion of people over 65 years in the total European population has been on the rise. As age advances, the risk of chronic health issues like heart diseases, cancer and neurological disorders increases dramatically. The older population has a higher dependency on medicines for the management of age-related diseases. This growing geriatric demographic will continue driving the demand for pharmaceutical drugs across the European region over the coming years.
Impact of Geopolitical Situation on Europe Pharmaceutical Drugs Market Growth
The Europe pharmaceutical drugs market is facing several geopolitical challenges that can impact its growth over the coming years. The ongoing Russia-Ukraine conflict has disrupted supply chains in the region. Many raw materials and active pharmaceutical ingredients(APIs) used in drug manufacturing were sourced from Russia and Ukraine. With exports from these countries halted due to sanctions and war, drug makers are struggling to find alternative suppliers. This has led to shortages and price increases of several essential medicines in European markets.
The conflict has also weakened European economies and increased inflation. This makes healthcare less affordable for consumers and governments. Low consumer demand and pricing pressures induced by the economic downturn can reduce market potential in the short-term. Moreover, the energy crisis resulting from sanctions on Russian oil & gas exports has increased production costs for pharmaceutical companies. Firms may have to hike drug prices further to offset rising costs, limiting market expansion.
To mitigate such geopolitical headwinds, drug makers must diversify their supply chains beyond the region and establish strategic collaborations with manufacturers in other locales like North America and Asia. They also need to fast-track development of complex generic drugs to enhance cost competitiveness. European governments should strengthen public health budgets to improve medicine access despite inflationary pressures. In the long-run, transition to renewable energy can help address over-dependence on Russian energy imports as well.
Geographical concentration of Europe Pharmaceutical Drugs Market in terms of Value
In terms of value, the Europe pharmaceutical drugs market is highly concentrated in countries like Germany, United Kingdom, Italy, France and Spain. Together, these nations account for over 60% of the total regional market value. Germany leads with a share of around 15-16% owing to its large elderly population and generous public drug reimbursement regime. The U.K. holds the second spot on account of a strong private healthcare insurance industry and high prevalence of chronic diseases. Italy, France and Spain also boast sizeable market potential fueled by their public health programs covering a vast majority of citizens.
Fastest Growing Region for Europe Pharmaceutical Drugs Market
Central and Eastern Europe is expected to emerge as the fastest growing region in the Europe pharmaceutical drugs market during the forecast period. Driven by increasingly affluent consumers and improving medical infrastructure across nations like Poland, Czech Republic, Hungary and Romania, the sub-region is witnessing rising healthcare expenditure as well as stronger demand for novel, high-quality medicines. Favorable FDI policies are also attracting many global pharmaceutical majors to set up manufacturing bases and sell their products in these emerging markets offering scope for double-digit gains.
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