Austria - PharmaceuticalsAustria - Pharmaceuticals

Overview

Pharmaceuticals account for around 16.5% of Austria’s total healthcare spending and 1.8% of GDP. In 2018, pharmaceutical sales were $8.2 billion or $942 per capita. Both imports and exports have risen significantly in recent years, a trend that should continue at an estimated 3.3% annual market growth rate over the next several years.

U.S. pharmaceutical products enjoy excellent success in the Austrian market and are the top U.S. export category, with 25% growth from 2017 to 2018 according to U.S. Census data.  U.S. manufacturers hold around 30% of the market, and the Austrian operations of U.S. companies are seen as market leaders in the biotech sector. The greatest challenge for U.S. exporters to Austria is the process of gaining authorization for reimbursement financing from the social insurance carriers.

The most important market drivers for the Austrian pharmaceutical market are: 1) an aging population, 2) rapid advances in pharmacological technology that is producing new treatment options, and 3) cost constraints as enforced by the statutory national healthcare insurance carriers. Another interesting aspect of Austrian healthcare is the commonly held skepticism about what Austrians refer to as “school medicine,” which refers to science-based modern medicine. Alternative treatments, including natural remedies, homeopathic products, and traditional Chinese medicine, while not reimbursed by the insurance carriers, have a broad following and are a significant source of income for pharmacies. 

Pharmaceutical distribution flows through two channels:  hospitals (around 20%) and pharmacies/dispensing doctors (around
80%). Prescription drugs make up the majority of all pharmaceuticals sales, reaching $7.2 billion in 2018. The prescription drug market, in turn, is dominated by patented drugs with 87% of the prescription market and 72% of the total pharmaceutical market. Generics are experiencing slower growth rates in Austria than most OECD markets despite efforts on the part of the government to encourage their use. This is at least partly due to the strong price controls enforced by the social insurance payers that reimburse original and generic producers at the same maximum rate for off-patent preparations.

As of this writing, prescription medicines are being added to the national eHealth record system (ELGA). This will enable healthcare providers to track prescription histories and monitor/prevent problematic drug interactions.

The over the counter (OTC) market is much more restrictive in Austria than in the United States.  Even simple pain relievers and most nutritional supplements must be approved for sale and can only be purchased in licensed pharmacies. As a result, prices for non-prescription medications are high. The most common diagnoses requiring prescription medications are high blood pressure, chronic cardiac insufficiency, heartburn/acid indigestion, depression, ADHD, and high cholesterol. The most frequently purchased over the counter treatments are cough/cold, vitamins/supplements, pain relievers, and indigestion remedies.

The Austrian government prioritizes attracting investments in the biotech sector and has had significant success over the past several years with major R&D investments from Boehringer Ingelheim (Germany) and Octapharma (Switzerland). With more than 330 pharmaceutical and biotech companies operating in Austria, of which 175 are R&D and manufacturers and 161 are sales/service/suppliers, Austria is expected to maintain its status as a pharmaceutical net exporter. Most major multinational companies have sales/distribution subsidiaries in Austria, and several also have R&D and/or manufacturing facilities. In addition, Austria is home to its own small and mid-size manufactures, including significant generics and homeopathic and natural remedy producers. A directory of life science companies in Austria can be found at www.lifesciencesdirectory.at/. 

(total market size = (total local production + imports) - exports)
Sources: fitchsolutions.com, Austria Pharmaceuticals and Healthcare Report Q2 2019; Statistik Austria; US Census data; estimates based on growth rates and other factors.  
 

Market Access and Reimbursement

Access to the Austrian pharmaceutical market is subject to national and EU legislation, and market access can be requested either for a single country or for the entire EU. The approving authority in Austria is the “Austrian Federal Agency for Safety and Healthcare”, operational sub-unit “AGES Pharm Med.” Because Austria has a statutory public healthcare system, pharmaceutical treatments must be included in the national reimbursement scheme in order to be economically viable.

Opportunities

• Medication for cardiovascular conditions (high blood pressure, high cholesterol, cardiac insufficiency)

• Medication for cancer treatment, including breast, lung, prostate, colon, and pancreas

• Medication for coughs/colds, indigestion, pain relievers

• Vitamins/food supplements

• Psychopharmacological medications, all indications

Web Resources

Statistik Austria (Austrian Statistics Office)
http://www.statistik.at  

LISA Austria (Austrian Life Sciences Cluster)
http://lifescienceaustria.at

Bundesministerium für Gesundheit (Austrian Federal Ministry for Health)
http://www.bmg.gv.at/

Gesundheit Österreich GmbH (Austrian Federal Institute for Health)
http://www.oebig.at

Hauptverband der österreichischen Sozialversicherungsträger
(Association of Austrian Social Insurance Carriers)
http://www.sozialversicherung.at

AGES Österreichische Agentur für Gesundheit und Ernährungssicherheit
(Austrian Agency for Health and Food Safety)
http://www.ages.at

Fachverband der Chemischen Industrie (Association of the Austrian Chemical Industry)
http://www.fcio.at

PHARMIG (Austrian Association of Pharmaceutical Enterprises)
http://www.pharmig.at

Apothekerkammer (Austrian Pharmacists Association)
http://www.apotheker.or.at

FOPI (Association of Research-Based Pharmaceutical Companies in Austria)
Web: http://www.fopi.at