Loss of product exclusivity, low levels of product growthand safety issues dogged the industry in 2007, causing the US drug market togrow by 3.8%. “These trends will continue to shape the marketplace,” explainsDiana Conmy, IMS Health’s director of market insights. “Overall we are seeing anew lower growth environment in the US market. It was much higher in 2006because of the Medicare Part D program, primarily. That boost did not duplicatein 2007. What we were left with were these other underlying dynamics.”

Conmy views 2007 as a year where some of pharma’s biggerplayers finally may have reached critical mass, at least from a salesperspective.

“Whether or not they are likely to change that, I wouldn’twant to predict, but if you look at the top five companies, they are the folksthat (also) have big blockbusters going off patent. Additionally, some of thesafety issues are also prevalent within the top 10. They have the challengesthat they have to face in the market going forward.”

As larger drugmakers are impacted by the slew of patentexpiries slated for 2008 (See Fig. 10), smaller or mid-size companies may bebetter positioned to take advantage of the current marketplace due to theirinvolvement in specialist-driven areas, which grew by 10.5% in 2007.

Conmy adds: “The pharma industry is still very large interms of its size and in terms of its dollar value and is still experiencingpositive growth. There are still a lot of areas of unmet need. There isresearch and development going on to bring products to the market. We still seeroom for innovation. We still see room for success.”