New Market Research Report: Hungary Pharmaceuticals & Healthcare Report Q1 2014

From: Fast Market Research, Inc.
Published: Mon Feb 03 2014

BMI View: We do not envisage much improvement in terms of Hungary's operating environment for pharmaceutical manufacturers heading into 2014. Despite the volume demand supported by population ageing and epidemiological factors, continued downward pressure on prescription prices remains a major issue.

Headline Expenditure Projections:

* Pharmaceuticals: HUF619.15bn (US$2.75bn) in 2012 to HUF574.65bn (US$2.58bn) in 2013; -7.2% in local currency terms and -6.2% in US dollar terms. Local currency forecast broadly in line with the previous quarter's projection.
* Healthcare: HUF2,170bn (US$9.65bn) in 2012 to HUF2,152bn (US$9.67bn) in 2013; -0.8% in local currency terms and +0.2% in US dollar terms. US dollar forecast significantly lower in relation to previous quarter's projection, due to new foreign exchange expectations.

Risk/Reward Rating: Our proprietary risk and reward assessment tool has been gradually adjusted to be increasingly transparent and sensitive in relation to potential rewards. Therefore, as its market opportunities get increasingly constrained, Hungary keeps slipping down the regional table, currently ranking ninth out of the 20 regional markets profiled in the Central and Eastern Europe (CEE) region. While its Risks profile is generally predictable, its Rewards have worsened over the past few years, and we envisage little positive change in the short to medium term.

Full Report Details at

Key Trends & Developments

* According to local press reports from October 2013, Hungarian hospitals are suffering from chronic shortage of anesthesiologists and surgeons due to a HUF60bn (US$274.18mn) deficit in the state hospitals budget. The government has recently decided to raise the salaries of around 95,000 healthcare workers by end-2013 to stop the ongoing 'brain drain' of Hungarian health professionals, although it remains to be seen if the move has been successful.

BMI Economic View: An uptick in Hungarian leading indicator data, combined with promising export potential, has led us to upgrade our forecasts for real GDP growth in 2013 and 2014. However, the country's business environment remains unattractive, placing notable downside risks to this view. Therefore, we still remain cautious towards calling for a robust recovery in the Hungarian economy.

BMI Political View: Hungary's relationship with the European Union (EU) is set to remain frosty, despite the government agreeing to scale back some recent controversial amendments to the constitution. While this backtracking has proven beneficial for Hungary's finances in the short term, the Hungarian economy has become reliant on European financing, which does not bode well for future fiscal stability. Nevertheless, with Prime Minister Viktor Orban's Fidesz party set to retain power in the spring 2014 general election, we see little chance of an improvement to the current situation.

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