Will Generic Drugs Help Curb Healthcare Costs?

Will Generic Drugs Help Curb Healthcare Costs?
March 02 01:00 2016

Our population is aging and more people than ever are taking prescription drugs, contributing to the rising costs of health care. Consumers, insurance companies, and governments are all helping to fuel the growth of the generic drug industry by demanding lower-cost alternatives to brand name pharmaceuticals. In our view, generic pharmaceuticals can be seen as a timely and meaningful solution.

How Demographics Are Shaping Generic Drug Growth

Market Realist – Global demographics are undergoing a paradigm shift. The world is aging fast. Fertility rates keep falling while life expectancy keeps rising. According to the United Nations Population Fund, one in nine people in the world is currently older than 60. As living standards, healthcare, and welfare services continue to improve, the proportion of older people is likely to rise further. This demographic shift is likely to spur an increase in spending on healthcare and medicine. The generic drugs industry is likely to sustain robust growth in the coming years, and demographics are a key piece of the puzzle! In fact, demographics are shaping generic drug growth in a huge way.

The graph above shows the estimated over-65 population by country for 2010 and 2050. Emerging markets (VWO) like India (EPI)(SCIF) and Indonesia (IDX) have younger populations than the developed world (EFA)…

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