A recently published report commissioned by the International Federation of Pharmaceutical Manufacturers & Associations (IFPMA) reveals how the pharma industry continues to boost the global economy across regions. The pharma industry’s share of global GDP value added increased by an average of 6% annually between 2006 and 2012, reaching $437 billion in 2012.

Titled, “The Economic Footprint of the Pharmaceutical Industry,” and conducted by German research institute WifOR, the study also said the industry employed more than 4.4 million people worldwide, while the sector’s labor productivity exceeded the average in an industrialized nation such as Germany.

“With the present study it is possible to discuss the economic footprint of the pharmaceutical industry for the first time on a continental level,” said Dennis Ostwald, CEO of WifOR. “This highlights a shifting perspective of pharma from a cost factor to a driver of growth, employment, health and last but not least wealth. Tourism and aviation together with pharma are three major industries that had carried out innovative studies that focus on calculating the economic footprint associated with their products.
These calculations of the pharmaceutical industry as part of the industrialized health economy represent the beginning of profound insights into the world economy.”

On a regional basis, Asia’s pharmaceutical industry accounted for the largest share of both global GDP and the sector’s workforce.
Asia contributed $163.3 billion to GDP value added, followed by Europe at $134.8 billion and North America at $105.3 billion. In addition, the industry yields positive social consequences prompted by its global labor force. It employs as much people as the entire workforce of Belgium across all sectors. Three million people in Asia worked in pharmaceuticals, while the industry employed 750,000 in Europe and 270,000 in North America.

The report also said originator drugs, rather than generics, accounted for 60% of the industry’s economic contribution but only 42% of employment.

It is clear that the pharma industry has a far reaching impact on the world’s economy, with a total economic footprint of $437 billion in terms of Gross Value Added (global GDP), which is equivalent of the economic performance of Argentina.

Commenting on the report Dr. Brendan Shaw, assistant director general at IFPMA said, “The pharma industry is boosting the world economy in every regard; bringing revolutionary new drugs to patients, supporting high-value jobs and helping strengthen local communities and the world’s economy. To allow our industry to enjoy its full potential to drive significant change for the 21st century, we need to keep on creating enabling environments and incentives.”

Tim Wright, Editor
twright@rodmanmedia.com