The Pharmaceutical Industry in Europe Key data INDUSTRY

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The Pharmaceutical Industry in Europe Key data INDUSTRY (EFPIA Total) (*) 1990 2002 2003

The Pharmaceutical Industry in Europe Key data INDUSTRY (EFPIA Total) (*) 1990 2002 2003 Production 63, 127 121, 311 158, 647 170, 000 (e) Exports 23, 180 89, 443 144, 022 170, 000 (e) Imports 16, 113 62, 810 108, 063 130, 000 (e) Trade balance 7, 067 26, 633 35, 959 40, 000 (e) R&D expenditure 7, 941 17, 661 20, 164 21, 100 (e) 500, 762 540, 106 588, 091 588, 000 (e) R&D employment (units) 76, 287 87, 625 100, 503 100, 500 (e) Pharmaceutical market value at exfactory prices 43, 005 86, 696 104, 180 111, 500 (e) Employment (units) Values in € million unless otherwise stated (*) Excluding Turkey Source: EFPIA member associations (official figures) – (e): EFPIA estimate

European total pharmaceutical exports, imports & trade balance 1980 -2003 (€ million) Note: Data

European total pharmaceutical exports, imports & trade balance 1980 -2003 (€ million) Note: Data 2003: EFPIA estimate Data based on SITC 54 Source: EFPIA Member Associations (official figures)

EU Trade balance – High technology sectors (€ million) – 2002 Source: Eurostat, SITC

EU Trade balance – High technology sectors (€ million) – 2002 Source: Eurostat, SITC 54

Breakdown of the world pharmaceutical market – 2003 sales Source: IMS World Review 2004

Breakdown of the world pharmaceutical market – 2003 sales Source: IMS World Review 2004

Breakdown of the world pharmaceutical market 1990 - 2003 Total pharmaceutical market value 1990:

Breakdown of the world pharmaceutical market 1990 - 2003 Total pharmaceutical market value 1990: 135, 900 million Euros 173, 000 million Dollars Source: IMS World Review 2004 Total pharmaceutical market value 2003: 412, 290 million Euros 466, 300 million Dollars

Total pharmacy market (at ex-factory prices) Average annual growth rate 1992 -2002 Source: EFPIA

Total pharmacy market (at ex-factory prices) Average annual growth rate 1992 -2002 Source: EFPIA member associations, Ph. RMA, JPMA

New Molecular Entities 1989 -2003 Source: SCRIP Publications - EFPIA calculations (according to nationality

New Molecular Entities 1989 -2003 Source: SCRIP Publications - EFPIA calculations (according to nationality of mother company)

Pharmaceutical R&D expenditure in Europe, USA and Japan, 1990 -2003 € million, 2002 constant

Pharmaceutical R&D expenditure in Europe, USA and Japan, 1990 -2003 € million, 2002 constant exchange rates Data 2003: estimate EFPIA & Ph. RMA Source: EFPIA member associations, Ph. RMA, JPMA

Pharmaceutical R&D expenditure in Europe, USA and Japan, 1990 -2003 Million of national currency

Pharmaceutical R&D expenditure in Europe, USA and Japan, 1990 -2003 Million of national currency units* * National currency units: Europe: € million; USA: $ million; Japan: ¥ milliion x 100 Data 2003: estimate EFPIA & Ph. RMA Source: EFPIA member associations, Ph. RMA, JPMA

Location of R&D spending by EU companies 1990 -1999 Source: EFPIA, 2000

Location of R&D spending by EU companies 1990 -1999 Source: EFPIA, 2000

Biopharmaceuticals Europe versus USA (2002) Europe USA Turnover (€ million) 8, 733 31, 994

Biopharmaceuticals Europe versus USA (2002) Europe USA Turnover (€ million) 8, 733 31, 994 R&D expenditure (€ million) 5, 274 17, 201 Net loss (€ million) 2, 921 9, 913 Number of public companies (units) 102 318 Number of employees (units) 33, 304 142, 900 Source: Ernst & Young, ‘Beyond Borders, The Global Biotechnology Report 2003’ (data relate to publicly traded companies)

Share of Global Biotechnology Revenues Publicly traded companies (2002) Note: Global revenues of €

Share of Global Biotechnology Revenues Publicly traded companies (2002) Note: Global revenues of € million 43, 730 (USA: 31, 994; Europe: 8, 733; Canada: 1, 550; Asia/Pacific: 1, 453) Source: Ernst & Young, ‘Beyond Borders, The Global Biotechnology Report 2003’

Share of Global Biotechnology R&D Expenses Publicly traded companies (2002) Note: Global R&D expenses

Share of Global Biotechnology R&D Expenses Publicly traded companies (2002) Note: Global R&D expenses of € million 23, 269 (USA: 17, 201; Europe: 5, 274; Canada: 586; Asia/Pacific: 208) Source: Ernst & Young, ‘Beyond Borders, The Global Biotechnology Report 2003’

Number of new molecular entities (NMEs) and biotechnology products first launched worldwide 1990 -2003

Number of new molecular entities (NMEs) and biotechnology products first launched worldwide 1990 -2003 Source: CMR International

R&D as a percentage of sales 1985 -2003 Source: EFPIA Member Associations (official figures)

R&D as a percentage of sales 1985 -2003 Source: EFPIA Member Associations (official figures) – (e): EFPIA estimate

Number of Drugs in active R&D 1999 -2003 Source: SCRIP, May 2003

Number of Drugs in active R&D 1999 -2003 Source: SCRIP, May 2003

EU / US ‘Global’ Environment USA • Basic patent (20 years) • Patent Term

EU / US ‘Global’ Environment USA • Basic patent (20 years) • Patent Term Restoration – max 5 years, 1984 • Biotech Patent, 1983 • Orphan Drug Act, 1984 • Same levels of IPRs across all States • Bayh-Dole Act + National Institutes for Health • Economic environment (direct access to a large unified market; competitive market pricing) EUROPE • Basic patent (20 years) • SPC – max 5 years, 1992 • Biotech Patent 2000 -yet to be applied in 8 MS • Orphan Drug Reg. , 2000 • Lower IPRs in some EU MS (+ EU enlargement) • European Framework Research Programme • Economic environment (no direct market access; price controls; free movement of goods)

R&D Expenditure as a percentage of GDP (2002) Note: Source: Greece, Italy, Japan, The

R&D Expenditure as a percentage of GDP (2002) Note: Source: Greece, Italy, Japan, The Netherlands, Switzerland: 2000 data; Belgium, Denmark, Germany, Ireland, Portugal, Spain, Sweden, Acceding countries: 2001 data EUROSTAT & DG Research, ‘Statistics on Science and Technology in Europe: data 1991 -2002’, February 2004; Swiss Federal Statistical Office (Switzerland)

Innovation – Market penetration Geographical breakdown (by main markets) of sales of new medicines

Innovation – Market penetration Geographical breakdown (by main markets) of sales of new medicines launched during the period 1998 - 2002 70 % USA Source: IMS, 2003 18 % Europe 4% Japan 8% ROW

Product life cycle in US and Europe US Europe Sales Utilisation and Price Level

Product life cycle in US and Europe US Europe Sales Utilisation and Price Level Generic competition Delay in Market Access Source: GSK European policies do not reward innovation but neutralise generic competition Time

Share of Parallel Imports in Pharmacy Market Sales (%) - 2002 % Note: Denmark,

Share of Parallel Imports in Pharmacy Market Sales (%) - 2002 % Note: Denmark, Germany, The Netherlands, Norway, Sweden, UK: Data 2002 Norway: share of total market sales (estimate) Source: EFPIA Member Associations

Total market sales (at ex-factory prices) in EU acceding countries (2002 – € Million)

Total market sales (at ex-factory prices) in EU acceding countries (2002 – € Million) Note: Bulgaria, Estonia, Latvia, Lithuania: pharmacy sales only Source: IMS Health

EU Acceding & Candidate Countries GDP per capita (PPS) - € 2002 Source: Eurostat,

EU Acceding & Candidate Countries GDP per capita (PPS) - € 2002 Source: Eurostat, Statistics in Focus 47/2003

Delays From Pricing And/Or Reimbursement Application To Reimbursement 90 days 180 days Belgium Greece

Delays From Pricing And/Or Reimbursement Application To Reimbursement 90 days 180 days Belgium Greece Portugal France Austria Finland Italy Norway Spain Increasing overall delay Netherlands Switzerland Sweden Denmark Ireland Pricing Germany UK 0 Reimbursement P&R 100 200 300 400 500 Publication 600 700 800 (Days) • In Belgium - until January 2002, the transparency commission process had to be conducted before a company could apply for reimb of a given product. In France, only ambulatory care products have been included in this analysis. In Italy and Sweden the pricing an procedure can start as soon as CPMP opinion is available (for centrally approved medicines). This analysis does not reflect the imp in Italy. In Spain anecdotal evidence suggests that delays have increased recently. In Switzerland a more comprehensive study conc shows an average delay over 180 days. Finland has a two-tier reimbursement system, with a slower process for treatments of chron (reimbursed at 75%) and serious or life-threatening diseases, and a faster one for acute diseases. Delays shown in this study do not distinction, and actual pricing and reimbursement delays are typically longer for medicines in the 75%/100% reimbursement categori