Denmark’s pharmaceutical market will decrease in value from $3.5 billion in 2013 to $3 billion by 2020, with price-cap agreements and high tax rates on pharmaceutical products two of the largest barriers to growth, according to research and consulting firm GlobalData.
Price-cap agreements between the Danish Ministry of Health and the Danish Association of Pharmaceutical Industry have been in place since 2008 and continue to limit pharmaceutical market growth, according to the report, as the government tries to keep drug prices from escalating.
Other market-inhibiting factors include a 25 percent value added tax on pharmaceutical products, high compared to other EU countries; restricted sales of over-the-counter medicines and a costly labor force.
Still, there are a number of positive conditions for the future of the Danish pharmaceutical market, Joshua Owide, GlobalData’s Director of Healthcare Industry Dynamics, said in an article. Increasing demand for medicine and higher healthcare expenditures, as well as government healthcare reforms will help to sustain the drug market. Also, Denmark’s corporate taxes are scheduled to gradually decrease to 22 percent by 2016, Owide noted.