by The pharmaceutical industry in the United States develops and markets drugs to treat various diseases and medical conditions. Some of the major product types include biologics, branded drugs, generic drugs, and over-the-counter medications. Biologics and branded drugs command the highest prices but offer innovative treatment options for chronic diseases like cancer, diabetes, and cardiovascular disorders. Generic drugs provide affordable treatment alternatives for common ailments like colds, flu, and gastrointestinal issues. The demand for pharmaceutical products in the country is supported by the growing disease burden and an aging population seeking healthcare and medical treatment. Significant funding for research and development also leads to new drug approvals and product launches every year.
The United States Pharmaceuticals Market was valued at US$ 599.47 Bn in 2023 and is expected to exhibit a CAGR of 8.6% over the forecast period 2023-2030, as highlighted in a new report published by CoherentMI.
Market Key Trends:
One of the key trends in the United States pharmaceuticals market is the rising adoption of biopharmaceuticals. Biologics have revolutionized the treatment of various chronic and lifestyle-related diseases. Many biologics have been developed as alternatives to small-molecule drugs and offer target-specific actions with fewer side effects. According to research reports, biologic drugs accounted for over 40% of FDA approvals between 2010 and 2019. The market for biopharmaceuticals in the US is expected to grow steadily due to the development of novel biologics targeting rarer diseases. Several blockbuster biologics are also anticipated to lose patent protection in the forecast period, opening up opportunities for biosimilars or follow-on biologics.
Porter’s Analysis
Threat of new entrants: The threat of new entrants is moderate in the US pharmaceuticals market. Regulations related to drug discovery, clinical trials, and market approvals pose significant barriers. Nonetheless, generic competition remains a threat with patent expirations.
Bargaining power of buyers: The bargaining power of buyers is high given the presence of large pharmacy benefit managers (PBMs) and public/private health insurers. PBMs leverage their formulary coverage decisions and buyer’s market nature to negotiate discounts and control rising drug costs.
Bargaining power of suppliers: Suppliers face moderate bargaining power due to the US market concentrating most late-stage clinical trials and drug production facilities. However, established contract manufacturing organizations (CMOs) are gaining advantage over proprietary pharmaceutical companies.
Threat of new substitutes: The threat of new drug substitutes is moderate to high as biologics are increasingly replacing small molecule drugs, and generic competition intensifies with patent expirations. New drug delivery mechanisms and precision medicine also represent substitutes.
Competitive rivalry: Competition is intense among large pharmaceutical companies due to generics facing revenue loss from key drug patents expiry and rising R&D costs for novel drugs. Mergers and acquisitions activity remains high to gain market share and capabilities through asset consolidation.
United States Pharmaceuticals Market Segmentation
By Product Type
- Prescription Drugs
- Generic Drugs
- OTC Drugs
- Biologics
- Biosimilars
By Therapy Area
- Oncology
- Diabetes
- Autoimmune Diseases
- Neurological Disorders
- Cardiovascular
- Infectious Diseases
- Others (Respiratory, Gastrointestinal, etc.)
By Distribution Channel
- Hospital Pharmacies
- Retail Pharmacies
- Online Pharmacies
- Others
By Route of Administration
- Oral
- Parenteral
- Topical
- Others
By End-User
- Hospitals
- Clinics
- Homecare
- Others
Key Takeaways
The United States Pharmaceuticals Market Size is expected to witness high growth over the forecast period. Led by an aging population with growing disease prevalence, rising healthcare spending per capita, and new drug approvals, the US market represents the world’s largest single-country pharmaceuticals market.
Regional Analysis: The US pharmaceuticals market is consolidated regionally, with companies based in North America dominating sales and R&D spending. The Northeastern US region spanning New York, New Jersey, Pennsylvania, and Massachusetts houses key headquarters of major pharmaceutical companies and contract research organizations (CROs), positioning it as the dominant regional market globally.
Key Players: Key players operating in the United States pharmaceuticals market are Johnson & Johnson, Pfizer, AbbVie, Merck, Bristol-Myers Squibb, Amgen, Eli Lilly, Novartis. Mergers and acquisitions are increasingly shaping the competitive landscape as large pharmaceutical companies seek to offset revenue losses from generics and bolster pipelines through external innovation sourcing.
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*Note:
1. Source: CoherentMI, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
