Political impact on US pharmaceutical market assessed by Espicom

In the USA, November saw the Republicans took control of the House of Representatives, whilst the Democrats retained control of the Senate, with a reduced majority. These results will complicate Barack Obama's presidency for the remaining two years, following the approval of a major health care reform in March 2010.

The National Commission on Fiscal Responsibility & Reform published its first draft document in November 2010. Medium-term proposals affecting the health sector include paying doctors and other providers less, increasing drug rebates and strengthening the Independent Payment Advisory Board (IPAB); the latter two measures could affect the pharmaceutical industry particularly, notes a news report from Espicom Business Intelligence. The main long-term proposal affecting the health sector is to contain growth in total federal health spending to Gross Domestic Product (GDP) +1% after 2020.

The effect of the health care reform will be difficult to measure but pharmaceutical sales are expected to be boosted in the long-term. R&D investments are large but growth has slowed down. Around 85.0% of the USA's pharmaceutical requirements are domestically manufactured. A number of companies have made significant cutbacks, making reductions to sales forces.