The pharmacy market - France (2023)

1.2 A global pharmaceuticals market that continues to grow despite the health crisis

Size of the global pharmaceuticals market

In ****, the global pharmaceuticals market grew at a steady pace, driven by dynamic sales in many emerging markets (***) and, to a lesser extent, in Europe.According to IQVIA, it will grow by over **% in ****, to exceed $*,*** billion. This sharp acceleration is due to the marketing of Covid vaccines, particularly in Europe and North America. [***]

Globe News Wire's study"Pharmaceutical Market Size, Share, Growth Analysis Report By API Type" estimated the industry's CAGR (***) at *. **% to ****. As a result, the global drug market is estimated to be worth $*,*** billion in ****, rising to $**** billion by ****.

Global drug market size World, ****-****, in billions of dollars Source: ****

Market share and geographical distribution of global drug sales

Each year, the IQVIA Institute publishes a report on the global use of medicines, bringing together figures from the past year and *-year projections. The latest report, The Global Use of Medicines ****, gives the key figures for ****.

The United States is still the world's leading drug market(***). [***]

Geographical breakdown of worldwide drug sales World, ****, % sales Source: ****

Market spending by the global pharmaceutical industry

According to the IQVIA Institute's"Global Medicine Spendings and Usage Trends" report, published in March ****, pharmaceutical industry spending around the ...

1.3 The French pharmacy market

Size of the French pharmacy market

In the Insee nomenclature, pharmacies are recorded under NAF code **.**Z: retail sale of pharmaceutical products in specialized stores. Insee has produced the following graph, which shows the evolution of sales excluding VAT for this activity over the period ****-****.

Pharmaceutical retail sales excluding VAT in specialized stores France, ****-****, in billions of euros Source: ****

The French pharmacy market has been growing since ****, but has seen a particularly sharp increase post-health crisis. Indeed, market sales have risen from €**.** billion in **** to €**.*** billion in ****, representing a **% increase in * years.

In Le Bilan économique - édition ****, Leem reveals that the breakdown of annual drug sales is as follows:

Breakdown of a pharmacy's sales (***) France, ****, in Others: Other prescribed products *.*%; Other non-prescribed products **.*%; Services *.*%. Source: ****

In ****, the French pharmaceutical industry will generate **.*% of its sales from exports , and **. *% from sales of reimbursable prescription drugs.

Top ** drugs sold on the French out-of-home market in ****

Source: ****

On average, pharmacies generate around **% of their sales and gross margins from reimbursable products with regulated margins: more than two-thirds from medicines and just over **% from medical devices. [***]

1.4 Before and after the health crisis for pharmacists

The changing image of pharmacists

During the Covid-** health crisis, pharmacists were on the front line. They played a key role throughout the crisis, which improved their image among the French. Indeed, **% of patients say they have a more positive image of pharmacists than before. **% of them say they have an equally positive image. Confidence in pharmacists has also improved, with **% of patients saying they have more confidence in them. [***]

According to the same CNRS survey, patients have had more exchanges with pharmacists, encouraging them to ask for advice. Now, **% want to ask their pharmacists for more advice.

Changes in pharmacists' daily lives

Pharmed'Insight, an expert in pharmacy surveys, delivers the results of an initial study conducted among *** pharmacy owners over the period from March ** to **, ****. [***]

On average, a French pharmacy sees *** patients a day. During the COVID period, pharmacies welcomed twice as many patients with the same number of staff.

Like a very large proportion of healthcare professionals, pharmacies are particularly mobilized, despite measures deemed insufficient in the face of the crisis.this was despite measures deemed insufficient in the face of the crisis, despite staff concerns about the risk of contamination, and despite a widespread lack of protective equipment. ...

1.5 Foreign trade in French medicines

The French pharmaceutical industry has a strong international outlook, with almost half of its revenues generated by exports every year.

Value of French exports of pharmaceutical preparations France, *****-****, in billions of euros Source: ****

After strong increases in **** and ****, French exports of pharmaceutical preparations stalled in **** (***), reaching a value of ** billion euros.

French imports of pharmaceutical preparations rose for the eighth year running in **** (***). The years ****, **** and **** saw the greatest growth in imports, of **%, **% and *% respectively, the main reason for these increases being the strong demand for anti-Covid vaccines, which are often imported.

French trade balance in pharmaceutical preparations France, ****, in billions of euros Source: Intracen (***) - ** - pharmaceutical products For the same reason, against the backdrop of the health crisis, France's trade surplus in pharmaceutical preparations fell sharply in ****, from *.* billion euros in **** to *.* billion euros in ****. In ****, it has finally increased by **%, reaching * billion euros.

Internationalization strategies of the pharmaceutical industry in relation to foreign trade

Source: ****

2.1 Drug consumption in France

As a result of the health crisis, sales of medicines have risen by more than **% worldwide in ****, according to IQVIA estimates. The pandemic led to a sharp rise in demand for vaccines in many countries around the world. Over the medium term, the global pharmaceuticals market had already grown at a sustained pace, driven in particular by dynamic sales in many emerging markets (***).

French consumption compared to other European countries

In ****, French consumption of drugs per person per year will be €***, corresponding to total consumption of €**.*** billion. [***]. This figure has been falling since ****, as shown in the graph below, the claim that France is the world's leading consumer of drugs having been put into perspective in recent years.

Between **** and ****, per capita drug consumption fell by **% in France, while it rose by **% in Germany. What's more, French consumption was **% higher than British consumption in ****, and is only *% higher in ****. Finally, of these * countries, France is the only one whose consumption has fallen since ****.

However, the pandemic has reversed the trend, since after six consecutive years of decline, consumption of drugs in towns and cities rose by *.*% in ****[***].

The *th report on the consumption of city drugs during the Covid-** epidemic (***), produced ...

2.2 The French and pharmacy

Vaccination against Covid-** is one of the most effective measures for reducing severe forms and deaths due to Sars-CoV-*. To improve accessibility to the vaccines, French pharmacists were authorized to prescribe and administer them in March ****. The PharmaCoVax study, which aims to assess the satisfaction of users who have benefited from this service, was conducted in pharmacies from March ** to June **, ****.

Nearly two-thirds of respondents(***) had also received their vaccination in a pharmacy. Nine out of ** respondents who had been vaccinated against influenza in a pharmacy had received the Covid-** vaccine there. [***]

Nearly three-quarters of participants(***) mentioned that they already had a good opinion of pharmacists.they already had a good opinion of these professionals before the pandemic, which explains why their opinion had not changed.

French satisfaction with COVID-** vaccination in pharmacies France, ****, % (***) Source: ****

by

Generally speaking, the French trust pharmacists. Indeed, they have a rather positive image of their pharmacist: **% of those surveyed consider them to be qualified, competent and responsible. The survey also points out that this positive image is particularly evident in the opinions of the elderly, who attach a great deal of importance to their pharmacist.

In general, do you trust pharmacists? France, ****, in Source: ****

According ...

2.3 Demand expectations

Expectations for the future of the industry

The survey also reveals French people's opinions on the future of the industry.

Demand opinion on potential developments in the pharmacy sector France, ****, in % of favorable opinions Source: ****

For the possibility of remote ordering and in-store collection, the percentage of favorable respondents rises to **% when only men are considered, and rises to **% when only **-** year-olds are considered.

Customers' opinions on internet and supermarket sales

Respondents tend to agree that the role of pharmacists can be extended to include certain tasks hitherto reserved for doctors. However, they are much more cautious about moving towards other types of distribution channels.

Demand opinion on the evolution of drug distribution channels France, ****, in % Source: ****

It goes without saying that a change in mentality is noticeable among younger people. The proportion of respondents in favor of pharmacist teleconsultation rises to **% if we consider only respondents in the **-** age bracket.

In the same age bracket, **% of respondents are in favor of online drug sales on specialized sites managed by pharmacists; similarly, they are in favor of sales in supermarkets and sales on specialized e-commerce sites, with respective percentages of **% and **%.

No trend yet for online drug purchases

Very ...

2.4 Targeted drugs and the risk of stock-outs

The leem report shows that the majority of pharmacies' supplies are for the same drugs.

*Sales expressed in manufacturer's prices excluding tax

Source: ****

The market has become concentrated around the main drugs, and pharmacists' demand, which follows prescription demand, has been refocusing on a smaller number of drugs over the past ** years. Indeed, several European policies aim to converge prescriptions between different countries, and this is leading to a contraction in supply. In ****, the top *** drugs will account for **.*% of total sales[***]

The main stars of demand are antineoplastics and immunomodulators, with **.*% of the pharmacy market by value, followed by central nervous system drugs with **. *% and digestive system and metabolism drugs, with **. *%. [***]

Nevertheless, this may have a negative effect, as some respondents to the Harris Interactive study are already saying that they are regularly faced with stock-outs in ****.

Do you ever find yourself unable to obtain a drug from a pharmacy because it is out of stock? France, ****, in % Source: ****

For the under-**s, the cumulative percentage of "Often" and "From time to time" rises to **%, a phenomenon also observed among the population living more than * km away, for whom **% report this problem.

This phenomenon continues to worsen: in ****, the ...

3.1 The French pharmaceutical industry value chain and drug production

Drug industry value chain

Source: ****

Source: ****

Source: ****

The Leem report breaks down sales of drugs at manufacturer's prices sold in pharmacies, according to whether or not they are reimbursable.

Sales of pharmaceuticals at manufacturer's prices excluding VAT France, ****-****, in billions of euros Source: ****

The market is recovering slightly after a fall from **** to ****, in line with the French pharmacy market. More generally, in ****, the French pharmaceutical industry will generate sales of **.* billion euros, **% of which will come from exports. [***]

Production by French pharmaceutical manufacturers

In the Insee nomenclature, "manufacture of basic pharmaceutical products" is recorded under NAF code **.**Z. Insee then enables us to produce the following graph, which describes the evolution of pharmaceutical production in volume over the period ****-****.

Production of pharmaceutical manufacturers in France France, ****-****, % (***) Source: ****

We then observe a decline in the production of medicines (***), which falls from +*.*% in volume between **** and **** to +*. *% between **** and ****.

3.2 Pharmacies in France

The number of pharmacies in France is falling

The number of pharmacies in France has been falling steadily for over ** years. In ****, the network will consist of **,*** dispensaries, down *. *% on **** and **% on ****. The pharmacy market is undergoing major restructuring.

number of pharmacies France, ****-****, in thousands Source: ****

These closures reflect the economic need to rationalize the network. for example, in ****, there were ** pharmacies in La Roche-sur-Yon, whereas in relation to the number of inhabitants, only ** were needed. when a pharmacy closes, the pharmacist's license is sold on. However, to prevent the emergence of a new competitor, groups of pharmacists buy back the license, thus achieving a "license closure". This approach improves the organization of the network, and benefits all pharmacists still in business.

Distribution of pharmacies in France

Source: ****

3.3 The financial structure of pharmacies

The Pharm'Exco website provides detailed average data on margins, fixed costs, payroll, EBITDA and management remuneration for pharmacies, according to sales and location. As this content is very dense, it will not be fully reported here, and only the national averages will be extracted in the table below.

Source: ****

Breakdown of pharmacy sales

As described in section *.*, around **% of pharmacy sales (***) are generated by reimbursable drugs. The Leem report describes the breakdown of such sales between the various market players.

Average breakdown of sales (***) of reimbursable drugs sold in pharmacies France, ****, in Source: ****

In ****, pharmacists' remuneration will account for **. *% of the average breakdown of sales of reimbursable drugs. That of wholesaler-distributors is only *. *%, which is coherent, since the latter operate on very substantial volumes. For reimbursable drugs, a reduced VAT rate of *.*% has been introduced, plus a *.*% tax on direct sales.

Finally, pharmacists also receive several fees, including a dispensing fee for each box sold. These fees are not included in the calculation of the public price (***) of the drug, and are therefore not included in the above breakdown. [***]

3.4 The boom in e-parapharmacy and new distribution channels

E-pharmacy boom

Online sales of parapharmaceutical products have grown strongly during the health crisis, despite the lag in the industry (***). Sales on the Santé Discount platform, for example, jumped by **% in **** , and the pure player estimated sales of around *** billion euros in ****, representing a further increase of **%. [***]

Pharmacist groups are also moving into online sales. Pharmacie Lafayette, for example, took a majority stake in the Cocooncenter platform in early **** before launching its own online sales site in November.

To strengthen their positions in this ultra-competitive sales channel, online retailers are racing to achieve critical mass. Germany's Zur Rose, for example, has brought together all its European parapharmacy marketplaces (***) under the single DocMorris brand in February ****. [***]

New distribution channels

Faced with the growing power of e-parapharmacy, two new sales formats are emerging among physical distribution networks. On the one hand, "superparapharmacies" continue to expand. Benefiting from a particularly extensive range and economies of scale, they are positioning themselves as direct competitors to e-parapharmacy platforms. The Pharmabest group is particularly well positioned among the "superparapharmacies". Launched in ****, the brand has since inaugurated *** outlets(***) and central France. [***]

3.5 Pharmacy groups and brands

Pharmacist groups are collectives of dispensing pharmacists. They come together to cooperate and develop their business, but also, in some cases, to share a common concept, in which case they are referred to as XXL pharmacies, green pharmacies, etc.

Pharmacy groups

The first advantage offered by pharmacy groups is greater competitiveness in negotiations with wholesaler-distributors and pharmaceutical companies. Indeed, the greater the number of network members, the greater the number of orders placed with wholesalers, and the lower the price.

Most groupings also offer other advantages, such as optimized inventory management, joint referencing and sharing networks. The advantages for pharmacies are quite numerous. [***]

Brand names

Some groups claim to be positioned as banners. These positions result from the diversification of their offering, and are discussed with the pharmacies in their network, then established as selection criteria. Brand names have a stronger B*C identity function than groupings, which were originally designed to improve B*B negotiation.

This identity function is then associated with a brand logic, which implies a communication strategy to capture loyal customers. A way of preparing for the eventual liberalization of the sector.

The table below shows the ranking of chains in terms of number of members.

Chain ...

4.1 Consumer price index for drugs

The Leem report compares the cost-of-living index, which rose by **% between **** and ****, with the public price index for drugs (***), which fell by **.**% over the same period.

change in the consumer price index for drugs France, ****-****, base *** in **** Source: ****

This drop can be explained by the fact that theprice index for reimbursable specialties, which accounts for almost **% of the total, is falling sharply (***) prevents it from preventing this general decline. [***]

The report explains this decline by the growing share of generics in the reimbursable market, combined with the CEPS' policy of price cuts .

In fact, only non-reimbursable drugs benefit from price freedom, and so have seen their prices rise faster than inflation(***) over the ****-**** period. [***]

Between **** and ****, however, there will be a marked increase. This increase is largely attributable to current inflation and the Ukrainian crisis, which has damaged external relations and somewhat crystallized export trade. This has led to a mechanical rise in drug prices.

4.2 Supply trends: towards digitalization of the business

Pharmacies lag far behind in digitalization

Pharmacists are still lagging far behind when it comes to digitalization. The restrictive regulatory framework for online drug sales in France, the need for investment in terms of both time and money, and a reluctance or inability to use technology are all factors holding back pharmacies' digital transition. And yet, the issue is now difficult to circumvent:

Increased patient expectations since the health crisis, The need to relay new pharmacy services, The need to interconnect with other healthcare professions.

More structurally, new standards of service and customer experience are emerging around digital, emphasizing the criteria of innovation, responsiveness and empowerment, and even experience sharing and socialization. The chart below outlines some of the sector's growth opportunities.

Source: ****

The digital barometer of recent years

In ****, Pharmacie Digitale published its *st "Barometer of the digital maturity of pharmacy groups and chains". The * key figures of the **** edition are reported below.

*/* of groups have a prescription scanning solution; **% of groups offer at least * distinct activities via technological solutions (***); **% of group managements: use internal CRM and social networks; **% of groups consider outsourcing a risk; **% of groups are active on social media in April ****.

Who are nonetheless concerned by ...

4.3 Offer typology

Offer typology by business sector

Source: ****

5.1 General regulations

Restrictions on installation and sales

Ordinance no. ****-* of January *, ****, known as the "maillage territorial des officines" ordinance, ensures the harmonious distribution of pharmacies across the country. Thus, the creation must respect: * dispensary for every *,*** inhabitants (***) and * dispensary for every additional *,*** inhabitants. The population taken into account is that resulting from the latest census. Theregional health agency is the sole holder of the right to set up a pharmacy. It alone can issue a license after consultation with the Conseil Régional de l'ordre des pharmaciens. Other criteria are taken into account: accessibility of the future premises, conformity of the premises and the presence of a sufficient potential client population. Consolidation of pharmacies is possible not only in communities with more pharmacies than they need, but also in those where the demographics allow it. The rules for transferring, grouping and creating a pharmacy are set out in articles L.****-* et seq. of the French Public Health Code(***). TheMinisterial Order of February **, **** sets out the list of goods that pharmacies may offer for sale. Online sales are possible, subject to prior authorization from their local ARS. [***] A code of ethics must be respected: pharmaceutical practice is regulated by the French Public ...

5.2 Pharmacy remuneration reform

Reform of regulations governing creations, transfers and groupings

Following on from the law of January **, ****,Ordinance no. ****-* of January *, **** has several objectives:

Clarification of the provisions relating to the conditions for authorizing the opening of pharmacies, by way of creation, transfer and regrouping ; Provisions to encourage the establishment of pharmacies in areas where access to medicines is not satisfactorily guaranteed; Simplification and streamlining of administrative procedures. [***]

How pricing works

For reimbursable drugs, the French Social Security Code defines the conditions for setting prices and, at each level, the margins of the players involved in distribution.The PFHT (***). When pharmacies purchase drugs directly from laboratories, they are authorized to recover the wholesaler's margin in addition to their own.

Remuneration reform: early ****- late **** : changes in margins and fees

Since ****, three new dispensing fees per prescription, which can be added together, compensate for the drop in sales margins. Their role is to further protect pharmacists from drug price cuts.

The sales margin is reduced in exchange forhigher dispensing fees.

This agreement committed the pharmaceutical profession until ****. The total budget for this reform was *** million euros, to be deployed over * years, with individual and collective guarantees for pharmacists, as well as the potential ...

6.1 Segmentation: groups and chains

• Giphar groupe
• Pharmactiv (OCP Group)
• Alphega Pharmacie
• Giropharm
• Leader Sante Groupe
• Tanguy Parapharmacie
• Arkopharma
• BERGLAND PHARMA GMBH & CO. KG
• Sanofi Aventis
• Novartis
• Hygie 31- Laf Santé Lafayette
• Elsie Santé
• Pharmacorp (Hygie 31 groupe)
• Leader Price
• Pharmabest
• Sephora
• Aprium Pharmacie - Healthy Group
• OCP Répartition (Phoenix Group)
• Phoenix Pharma
• Pharmony
• Apsara
• Pharma Santé Développement
• La cooperative Welcoop
• Global Pharmacie
• Aelia
• Cofisanté
• Eurodep
• Agir Pharma
• APM Les Pharmacies de Méditérannée
• Apothéo
• Apothical
• Apothicoop
• APP Côte d'azur
• Aptiphar
• Artesipharm
• Artisan Santé
• ASPIC
• Avenir Pharma
• Be Pharma
• Boticinal
• Bretagne Santé Référence
• Cali Pharma
• Cap unipharm
• Cercle des Pharmaciens Coopérateurs
• Coté Pharma
• Dephie
• DL santé
• DPGS
• DPO Groupe
• Dynamis
• Elfimaje Majelis
• Escale santé
• Evolupharm
• Farmax
• Flexi Plus Pharma
• Forum santé
• G Plus Pharma
• GFC Pharma
• Gripamel
• Groupapharm
• Happy Pharmacie
• Hello Pharmacie
• Lab Officine
• Le Gall santé Services
• Les Pharmaciens d'armor
• Magdaléon
• Maxipharma
• Mediprix
• Mutualpharm
• Nextypharm
• Normandie Pharma
• Norpharma
• Objectif Pharma
• OmnesPharma
• Optopharm
• Originsanté
• Orphie Groupement de Pharmaciens
• Orphie Provence
• Oté pharma
• Paraph
• PDA Pharma
• Pharm & Free
• Pharm Auvergne
• Pharm O Naturel
• Pharm Upp
• Pharm-Agir
• Pharma 10
• Pharma france
• Pharma Platinum
• Pharma provence Groupe
• Pharma Sud
• Pharma Synergie
• Pharmaciens du sud
• Pharmacies groupe Rocade
• Pharmacyal
• Pharmadinina
• Pharmadirect
• Pharmadn
• Pharm ici
• Pharmamarket (Antwerpia groupe)
• Pharmarem
• Pharmatomic
• Pharmavance
• Pharmavenir
• Pharmaxial
• Pharmidée
• Pharmodel
• Positive Pharma
• Quartz groupement Pharmacies
• Réseau Katalys
• Réseau P&P
• Réseau Pharma Méditerranée
• Réseau Santé
• Resofficine
• Resonor Soprophar
• Santalis
• Socopharm
• Sofiadis
• Solution Réseau d'Achat Pharm Etoile
• Sopharef
• STC Pharma
• Sunipharma
• Suprapharm
• Synaps Pharma
• Synergiphar
• Teleconsult Pharma
• Totum pharmaciens
• UDPGO
• Union des Grandes Pharmacies
• Unipharm
• Unipharm Loire Océan
• Univers Pharmacies
• VPharma
• Ynova group