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Hungary Pharmaceuticals and Healthcare Report Q3 2008Published by: Business Monitor International Published: Sep. 15, 2008 - 59 Pages Table of Contents
AbstractHealthcare sector reforms continue to cast gloom over business prospects in Hungary’s pharmaceuticalmarket. Price cuts in 2007 designed to eliminate budget overspends meant the overall market contractedby 2.7%. The downturn was felt in all drug market sectors, a fact highlighted by poor domestic results fordrugmakers operating in the country. Nevertheless 2008 should paint a slightly brighter picture forpharmaceutical companies. However, compared with elsewhere in Central and Eastern Europe (CEE),Hungary will largely be considered as a lower priority, with market expansion restricted to low singledigit growth over the forecast period.Despite many protests over healthcare reforms, the Organisation for Economic Co-operation andDevelopment (OECD) has encouraged the government to persist in its efforts. Citing Hungary’s budgetdeficit of 9.2% of GDP - the largest in the EU - the OECD has called for fiscal consolidation and hasadvised that improvements in the healthcare system should come from efficiency gains rather thanincreased expenditure. Some positive news has been received by drugmakers, however, as the Constitutional Court declared theHUF5bn (US$32,563) registration fee for sales representatives illegal. At the same time, however, thecourt rejected an appeal against the 12% tax on reimbursable medicines. Drugmakers are continuing tofeel the effects of the financial impact of the tax. Sales in Hungary for domestic firm Gedeon Richterwere down by 14.8% year-on-year (y-o-y) in Q108, with the country's uncertain regulatory environmentcited as the key problem by Chief Executive Erik Bogsch. For this reason, the company’s investments inHungary are to be reduced. It is not only prospects for selling drugs in Hungary that are looking less than favourable, after theEuropean Commission (EC) requested Hungary change its tax laws for research and development (R&D).Under the current legislation, incentives are given to taxpayers who conduct their R&D activities inHungary rather than other EU states. The EC, however, sees this as contravening the freedom to provideservices guaranteed by Article 49 of the EC Treaty and Article 36 of the European Economic AreaAgreement (EEA). Meanwhile BMI’s new Burden of Disease Database has placed Hungary in the middle-rankings for CEEin terms of disability-adjusted life years (DALYs) lost due to all diseases and injuries. The leading causesof burden in the country are cardiovascular disease, neuropsychiatric conditions and cancer. Get Full Details About This Report >> |
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