The United States pharmaceuticals industry involves the discovery, development, production, and marketing of medications in the country. Pharmaceutical drugs treat various medical conditions such as central nervous system disorders, cardiovascular ailments, gastrointestinal issues, cancer, diabetes, and others. The increasing prevalence of chronic diseases owing to lifestyle changes and growing geriatric population has resulted in a surge in demand for pharmaceutical medications.
The United States pharmaceuticals was valued at US$ 599.47 billion in 2024 and is expected to exhibit a CAGR of 8.6% over the forecast period 2023 to 2030, as highlighted in a new report published by CoherentMI.
Market Opportunity:
The rising incidence of chronic diseases like cancer, cardiovascular disorders, diabetes and respiratory diseases offer lucrative growth opportunities to players in the United States pharmaceuticals market. According to the Center for Disease Control and Prevention, chronic diseases affect about 133 million Americans annually accounting for 90% of the nation's USD 3.5 trillion in annual health care costs. Furthermore, cancer alone is projected to account for USD 156.8 billion in healthcare spending in 2023. The growing healthcare costs associated with managing chronic diseases through pharmaceutical drugs is the key driving factor that could boost market revenues significantly over the forecast period. Drug makers stand to gain from increasing demand for innovative medications to effectively treat chronic conditions and curb rising healthcare expenditure.
Porter's Analysis:
Threat of new entrants: The threat of new entrants is moderate due to high capital investment required for R&D, manufacturing, compliance with stringent regulations and the brand loyalty of existing players. However, the increasing healthcare spending is making the market more lucrative for new players.
Bargaining power of buyers: The bargaining power of buyers is high as the US pharmaceutical market is highly regulated and buyers have a wide range of products to choose from. They can negotiate on prices with suppliers.
Bargaining power of suppliers: The bargaining power of suppliers is moderate as major players integrated backward and source key ingredients from a global supply chain. However, suppliers of patented drugs enjoy some pricing power.
Threat of new substitutes: The threat of new substitutes is high due to constant innovation and patent expirations leading to generics. Biosimilars are also emerging as cheaper substitutes in biologics therapies.
Competitive rivalry: The competitive rivalry is intense due to the dominance of few large players and differentiating capabilities. Players compete on new product launches, pricing strategies and acquisitions.
SWOT Analysis:
Strengths: Strong R&D capabilities, global scale of operations, recognizable brands and ability to launch differentiated products.
Weaknesses: Heavy dependence on blockbuster drugs, vulnerable to patent expiries, price control policies and regulatory risks.
Opportunities: Growing geriatric population, increasing healthcare expenditure, avenues in biologics and specialty drugs.
Threats: Drug price control measures, threat from generic drugs, recent CMS proposals for lowering drug costs.
United States Pharmaceuticals Market Segmentation:
- By Product Type
- Prescription Drugs
- Generic Drugs
- OTC Drugs
- Biologics
- Biosimilars
- By Therapy Area
- Oncology
- Diabetes
- Autoimmune Diseases
- Neurological Disorders
- Cardiovascular
- Infectious Diseases
- Others (Respiratory, Gastrointestinal, etc.)
- By Distribution Channel
- Hospital Pharmacies
- Retail Pharmacies
- Online Pharmacies
- Others
- By Route of Administration
- Oral
- Parenteral
- Topical
- Others
- By End-User
- Hospitals
- Clinics
- Homecare
- Others
Key Takeaways :
The United States Pharmaceutical Market Size is expected to witness substantial growth driven by favorable demographic trends, growing demand for specialty drugs and biologics. The geriatric population will especially fuel demand for chronic ailment therapies for conditions like diabetes, cancer, cardiovascular diseases. The global United States pharmaceuticals Market is estimated to be valued at US$ 599.47 billion in 2024 and is expected to exhibit a CAGR of 8.6% over the forecast period 2023 to 2030.
Regional analysis: North America region dominated the US market with over 80% share in 2023 due rising healthcare expenditure, innovative product pipelines, favorable policies and early adoption of new drugs. California, Florida and Texas are the leading states by pharmaceutical sales.
Key players operating in the US pharmaceuticals market are Pfizer, Johnson & Johnson, Merck, AbbVie, Eli Lilly, Amgen, Roche, Novartis, GlaxoSmithKline, Bristol-Myers Squibb. All the key players are involved in new product launches to improve treatment outcomes for various medical conditions. Several strategic acquisitions have also been made to enhance portfolio offerings.
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