Wholesalers play a more active role in the distribution and pricing of generic drugs. Generic drug manufacturers compete with each other for contracts with the three big wholesalers, which can put wholesalers in the position of being price-setters and market-makers for generic drugs. If generic manufacturers do not secure contracts with one of the big wholesalers, they can be effectively excluded from the market, giving wholesalers important leverage in generic price negotiations.3
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In some cases, wholesalers have even acquired their own sources of generic production via vertical integration.4 In other cases, they may engage in preferred contracting with generic drug manufacturers. Wholesalers may guarantee distribution of a specified volume of generic drugs for the manufacturer in exchange for the manufacturer selling at lower prices to the wholesaler. The wholesaler then sells generics at marked-up prices to cover the cost of their operations.
Wholesalers may increase generic sales by offering discounts to pharmacies that purchase a specified volume of generic drugs. Experts report overall generic markups in the range of 10 percent to 15 percent, although confidential contracts make it difficult to verify the accuracy of these estimates or determine the exact levels at which wholesalers are able to mark up specific drugs.5
Even though wholesalers mark up generic prices by a larger percentage than they do for brand prices (where they are price-takers, as described above), they derive greater revenue per unit from the latter. For example, a 15 percent markup on the average generic price of $30 for a month supply amounts to average generic wholesaler revenue of $4.56. In comparison, a 2 percent markup on the average brand price of $566 per month supply amounts to $11.33 in brand-name drug revenue for wholesalers.6 However, because generics comprise 90 percent of retail prescriptions, wholesalers make more money from generics than brands.7
Most generic drugs in the U.S. are extremely inexpensive, although there are some corners of the market in which lack of competition allows generic manufacturers to raise prices substantially. One review of generic drug prices in Medicaid found that for about 6 percent of products, there was a price hike of greater than 100 percent in 2017.8 In such relatively rare circumstances, wholesalers would benefit if they bought before the price hike and were able to charge the new, higher price.
Wholesalers also derive revenue from brand drug price increases by “forward buying,” the practice of building an inventory of drugs that were purchased at old, lower prices and waiting to sell until manufacturers increase prices. In 2020, manufacturers increased prices for 860 drugs by an average of 5 percent.9 In these cases, even small percentage price increases on expensive brand-name drugs may result in substantial revenue for wholesalers. Forward-buying was estimated to account for 40 percent of wholesalers’ revenues from 2002 to 2004.10 More recent reports suggest that in the past five years, wholesalers have gained less revenue from forward-buying, because manufacturers slowed rates of some list price increases.11
Despite some generic drug price spikes, generic drug reimbursement has been decreasing overall in the past decade. Generic retail prices in the U.S. now average 84 percent of those in other high-income countries.12 Consolidation in the pharmacy industry has resulted in large chains being able to negotiate lower generic drug prices with wholesalers.13 Although this may represent increased purchasing efficiency for payers and patients, it puts financial pressure on institutions that have historically relied on generic drug margins to remain profitable, such as independent pharmacies and wholesalers.14
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Increased scrutiny on generic drug price increases among policymakers may further squeeze wholesalers’ margins. In the face of growing political pressure, some manufacturers have pledged to not raise list prices,15 which would further reduce wholesalers’ revenue growth. A proposal to limit price increases to inflation starting in 2023 was a central part of the Build Back Better Act’s drug pricing reform framework considered by Congress in 2021. Under this legislation, manufacturers would be required to pay back price increases that exceed the rate of inflation in the form of rebates to Medicare. The House version of the bill would apply these inflationary rebates to both brand-name and generic drugs, although the Senate version exempted generic drugs from these requirements.
To diversify their business lines, generate additional sources of revenue, and provide value-added services to their customers, wholesalers have developed a variety of other services over the past two decades (see box).
Analysis of Leading Top 50 Pharmaceutical Wholesale & Distribution Companies, Forecasts by Type (Branded, Generics) AND Regional and Leading National Market Analysis AND COVID-19 Recovery Scenarios
New York, Oct. 11, 2021 (GLOBE NEWSWIRE) -- Reportlinker.com announces the release of the report "Top 50 Pharmaceutical Wholesale & Distribution Companies 2021" - https://www.reportlinker.com/p06135120/?utm_source=GNW
Pharmaceutical Wholesale & Distribution Companies Offer Full-Line Services to Pharmaceutical Manufacturers
Pharmaceutical full-line wholesalers will continue to provide services to manufacturers in the future. While full-line pharmaceutical wholesaling will be the mainstay, some view services targeted at helping the pharmaceutical industry as a potential source of growth and development. Bulk delivery, storage, and transportation of products that require specific conditions (temperature controlled, cold chain logistics, and clinical trials products, for example), end-to-end expertise in supply chain management, packaging and labelling of products for regional markets, and product monitoring and trace services (on-demand service for special products) are among the services available. In this environment, distribution services will play an increasingly important role in pharmaceutical distribution, especially when it comes to bringing goods to market and responding to the rise in direct sales.
Pharmaceutical Full-Line Wholesalers Give Pharmacies a Broad Range of Core And Added Value Services
As outlined above, pharmaceutical wholesalers clearly recognize and defend the pharmacist and pharmacy’s invaluable duties and specialization position, pharmaceutical full-line wholesalers give pharmacies a broad range of core and added value services. Warehousing and storage facilities, inventory management and automated order processing facilities, just-in-time distribution of items, product recall assistance, internal IT management systems and digital resources, training and training for pharmaceutical campaigns, as well as sales and purchasing research, and marketing support for individual products will play a growing role in the future.
What are the Market Drivers in Pharmaceutical Wholesale & Distribution Companies Industry?
. Meeting progressive quality standards for product distribution, cold chain requirement, specialty handling of medicines and the need to prevent falsified medicines entering into the supply chain - full-line wholesalers are the trusted supply chain partners
. Need for new solutions for manufacturers, pharmacists and patients
. Optimization of warehouse usage
UNIQUE COVID-19 VARIATIONS- only available in this report are dedicated analysis of 4 different rebound scenarios of how the market will develop - no matter how COVID-19 affects the economy.
How do prominent players strengthen their position throughout the world?
You must read this newly updated report if you are involved in this sector. The report shows you potential revenues up to 2031, evaluate information, trends, opportunities and business outlooks.
Discover how to stay ahead
Our 310+ page report provides 450+ tables and charts/graphs. Read on to discover the most lucrative areas in the industry and the future market prospects. Our new study lets you assess forecasted sales at overall world market and regional level. See financial results, trends, opportunities, and revenue predictions. Much opportunity remains in this growing Top 50 Pharmaceutical Wholesale & Distribution Companies Market. See how to exploit the opportunities.
Forecasts to 2031 and other analyses reveal the commercial prospects
. In addition to revenue forecasting to 2031, our new study provides you with recent results, growth rates, and market shares.
. You find original analyses, with business outlooks and developments.
. Discover qualitative analyses (including market dynamics, drivers, opportunities, restraints and challenges), major trends impacting pharmaceutical wholesale and distribution market, product profiles and commercial developments.
Discover sales predictions for the world market on the basis of region, submarkets for the forecast period, 2021-2031
Type Sub-Segment Forecast, 2021-2031 (US$ Mn, AGR%, CAGR%)
. Branded
. Generics
In addition to the revenue predictions for the overall world market and segments, you will also find revenue forecasts for 5 regional and 16 leading national markets:
Pharmaceutical Wholesale & Distribution Market Forecast by Region, 2021-2031 (US$ Mn, AGR%, CAGR%)
. North America Pharmaceutical Wholesale & Distribution Market Outlook, 2021-2031 (US$ Mn, AGR%, CAGR%)
. U.S. Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. Canada Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. Europe Pharmaceutical Wholesale & Distribution Market Outlook, 2021-2031 (US$ Mn, AGR%, CAGR%)
. Germany Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. UK Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. France Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. Italy Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. Spain Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. Russia Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. Rest of Europe Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. Asia Pacific Pharmaceutical Wholesale & Distribution Market Outlook, 2021-2031 (US$ Mn, AGR%, CAGR%)
. Japan Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. China Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. India Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. Australia Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. Rest of Asia Pacific Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. Latin America Pharmaceutical Wholesale & Distribution Market Outlook, 2021-2031 (US$ Mn, AGR%, CAGR%)
. Brazil Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. Mexico Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. Rest of Latin America Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. MEA America Pharmaceutical Wholesale & Distribution Market Outlook, 2021-2031 (US$ Mn, AGR%, CAGR%)
. GCC Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. South Africa Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
. Rest of Middle East & Africa Pharmaceutical Wholesale & Distribution Market Revenue, 2021-2031
Leading companies and the potential for market growth
Overall world revenue for Top 50 Pharmaceutical Wholesale & Distribution Companies market will surpass $xx billion in 2021, our work calculates. We predict strong revenue growth through to 2031. Our work identifies which organizations hold the greatest potential. Discover their capabilities, progress, and commercial prospects, helping you stay ahead.
Prospects for established firms and those seeking to enter the market- including company profiles for 50 of the companies involved in the Pharmaceutical Wholesale & Distribution Companies Market.
Companies Profiled in the Report:
1. McKesson Corporation
2. Alfresa holdings
3. AmerisourceBergen Corp
4. Cardinal Health
5. CR Pharmaceutical Group
6. Kingworld Medicines Group Ltd
7. MEDIPAL HOLDINGS
8. Profarma Distribuidora de Produ
9. Realcan Pharmaceutical Group Co
10. Shanghai Pharmaceuticals Holding Co., Ltd
11. SINOPHARM HOLDING CO LTD
12. Walgreens Boots Alliance
13. Zhejiang Int’l Group Co. Ltd
14. SUZUKEN
15. The phoenix group pharmaceuticals
16. Smith Drug Company
17. Prodigy Health
18. Ohki Healthcare Holdings Co., Ltd
19. North Carolina Mutual Wholesale Drug
20. Morris & Dickson
21. Mawdsleys
22. HyGen Pharmaceuticals, Inc
23. Fortissa
24. CuraScript Special
25. Capital Wholesale Drug Company
26. AAH Pharmaceuticals Ltd.
27. Drogueria Betances, Inc.
28. EzriRx
29. FCL Health Solutions
30. Firstline Pharma Ltd.
31. Goodwill Pharma
32. H. D. Smith
33. Henry Schein Inc.
34. Karo Pharma
35. Letco Medical
36. Masters Pharmaceutical
37. Medline Industries
38. Mockingbird Pharma
39. Mutual Drug
40. OTC Direct
41. Owens & Minor, Inc.
42. QK Healthcare Inc.
43. R&S Northeast LLC
44. RxOneShop
45. Safe Chain Solutions
46. Sigma PLC
47. TopRx
48. Value Drug Company
49. Premium Rx National, LLC
50. Kolmar
Key Questions Answered by this Report:
. What is the current size of the overall global Pharmaceutical Wholesale & Distribution Companies market? How much will this market be worth from 2021 to 2031?
. What are the main drivers and restraints that will shape the overall Pharmaceutical Wholesale & Distribution Companies market over the next ten years?
. What are the main segments within the overall Pharmaceutical Wholesale & Distribution Companies market? How much will each of these segments be worth for the period 2021 to 2031? How will the composition of the market change during that time, and why?
. What factors will affect that industry and market over the next ten years?
. What are the largest national markets for the world Pharmaceutical Wholesale & Distribution Companies? What is their current status and how will they develop over the next ten years? What are their revenue potentials to 2031?
. How will market shares of the leading national markets change by 2031, and which geographical region will lead the market in 2031?
. Which are the leading companies and what are their activities, results, developments, and prospects?
. What are the main trends that will affect the world Pharmaceutical Wholesale & Distribution Companies market between 2021 and 2031?
. What are the main strengths, weaknesses, opportunities, and threats for the market?
. How will the global Pharmaceutical Wholesale & Distribution Companies market evolve over the forecasted period, 2021 to 2031?
. How will market shares of prominent national markets change from 2021, and which countries will lead the market in 2031, achieving highest revenues and fastest growth?
Read the full report: https://www.reportlinker.com/p06135120/?utm_source=GNW
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