ARLINGTON, Va., October 19, 2012 – Healthcare product sales through the nation’s primary healthcare distributors hit a record high of $294 billion in 2011. Specifically, pharmaceutical products moved by distributors represent approximately 90 percent of sales in the U.S., according to the 2012–2013 HDMA Factbook.
Published by the Center for Healthcare Supply Chain Research, the 84th edition of the HDMA Factbook is a comprehensive reference tool based on information gathered from the Healthcare Distribution Management Association (HDMA)’s members. It provides distribution industry performance measures in such areas as market characteristics, finance, operations, information systems and distributor demographics, and is produced with support from Boehringer Ingelheim Pharmaceuticals, Inc.; RDC-Rochester Drug Cooperative, Inc.; TEVA Pharmaceuticals USA; EXP Pharmaceuticals Corp.; Ranbaxy Pharmaceuticals Inc.; and, Smith Drug Company, Div. J M Smith Corporation.
According to the Factbook, 2011 distributor sales, which increased by nearly 7 percent since 2010, outpaced the total growth of the pharmaceutical market during the same year. As IMS Health data indicates, pharmaceutical industry sales grew by 4 percent over 2010 to reach a total of $319.9 billion. A major reason for this growth is due to the continued introduction of specialty/biotech products into the marketplace.
While the majority of traditional distributors’ net sales — 98 percent — continue to be earned by distributing pharmaceuticals, the ongoing “patent cliff” is still affecting the product mix within these sales figures. Generic pharmaceuticals in particular gained 32 percent over 2010 to represent 11 percent of total distributor sales, while branded pharmaceutical sales have decreased by nearly two percent to reach nearly 75 percent of sales. Sales of prescription specialty products through distributors also fell slightly by one percent to account for 12 percent of distributors’ sales.
At the warehouse level, individual HDMA-member distribution centers processed an average of 27.2 million products in 2011. This represents more than 390,000 orders placed for healthcare products from an average of 1,100 manufacturers.
Finally, the Factbook notes that distributors’ profit margins grew slightly, with net profit after taxes to net sales increasing to 1.2 percent (from 1.1 percent in 2010).
“This year’s Factbook continues to provide valuable metrics on distributor efficiencies,” said Karen J. Ribler, Executive Vice President and COO of the Center for Healthcare Supply Chain Research. “It shows that healthcare distributors continue to be an essential stakeholder in the supply chain as the pharmaceutical market evolves.”
“I look forward to the annual release of the HDMA Factbook, as it always provides an accurate account of distributors’ efficiencies, and the critical role they play in the supply chain,” said Tony Pera, Senior Vice President for Supply Chain Management at AmerisourceBergen Corporation and Chairman of the Center for Healthcare Supply Chain Research Board of Directors.
The 2012–2013 HDMA Factbook: The Facts, Figures & Trends in Healthcare is now available for purchase for $95 (book) or $170 (book and data CD) through the HDMA Marketplace, at www.ShopHDMA.org. An electronic version is available as a downloadable PDF for single or corporate use. For more information, visit the Center for Healthcare Supply Chain Research website at www.HCSupplyChainResearch.org.
About the Center for Healthcare Supply Chain Research
The Center for Healthcare Supply Chain Research is a 501(c)(3) non-profit charitable organization that serves as the knowledge partner of the Healthcare Distribution Management Association (HDMA). The Center serves the healthcare industry by providing research and education focused on healthcare supply chain issues. The Center’s mission is two-fold: to conduct research and disseminate information that will enhance the knowledge base, efficiency and effectiveness of the total healthcare supply chain; and to provide thought leadership to further enhance the safety and security of the healthcare supply chain through future-focused study and programming.
HDMA is the national association representing primary healthcare distributors, the vital link between the nation’s pharmaceutical manufacturers and healthcare providers. Each business day, HDMA member companies ensure that nine million prescription medicines and healthcare products are delivered safely and efficiently to more than 200,000 pharmacies, hospitals, long-term care facilities, clinics and others nationwide. HDMA and its members work daily to provide value and achieve cost savings, an estimated $42 billion each year to our nation’s healthcare system. For more information, visit www.HealthcareDistribution.org.