06.11.2024
As of the first nine months of 2024, the Ukrainian pharmacy market shows positive dynamics, reflecting the country’s overall economic development. According to Ukraine’s Ministry of Economy, the Gross Domestic Product increased by 4.5% compared to the previous year for this period. The real GDP growth is projected to reach 3.5% by the end of 2024. However, the International Monetary Fund revised its April forecast for Ukraine, lowering the expected rate to 3%, while the World Bank maintained its forecast at 3.2%. Additionally, the economic growth forecast for Ukraine in 2025 was significantly lowered by both institutions: the IMF projects 2.5%, while the World Bank expects 2%.
The inflation forecast has also been adjusted. In July, the National Bank of Ukraine (NBU) increased the expected year-end inflation rate from 8.2% to 8.5%. However, the actual inflation rates in August and September exceeded this forecast, which may lead to further revisions. The shortage of qualified labor continues to impact economic activity, driving up nominal wages. However, due to high inflation, real wage growth remains restrained.
These macroeconomic factors, along with the population’s standard of living, significantly impact the development of the pharmaceutical market. This article presents key indicators and trends in developing Ukraine’s pharmaceutical market for the first nine months of 2024, based on data from the analytical platform PharmXplorer by Proxima Research’s Market Audit Ukraine project.
During this period, the sales of “pharmacy basket” products reached UAH 139.7 billion, an increase of 18.3% compared to the same period last year. In physical terms, sales reached 958.7 million packages, showing a 1.5% increase. Sales grew by 9% in dollar terms, reaching $3.5 billion. All categories of “pharmacy basket” products showed growth in monetary terms, although there was a slight decline in the physical sales of medicinal products, down by 0.2%. Dietary supplements recorded the highest growth, with a 28% increase in monetary terms and a 15% rise in physical terms. This has led to an increase in the share of dietary supplements in the market structure. As of the first nine months of 2024, the share of dietary supplements in the “pharmacy basket” accounted for 11.0% in monetary terms and 8.7% in physical terms.
In the retail sales structure for January–September 2024, there was an increase in the share of domestic medicines in monetary terms compared to the same period in 2023. At the same time, the share of foreign manufacturers increased in terms of units sold. The average price per package of “pharmacy basket” products as of the first nine months of 2024 reached UAH 145.7, a 16.5% increase compared to the first half of 2023. The highest average price per package was recorded for dietary supplements at UAH 182.7 per package, followed by medicinal products at UAH 176.3, cosmetics at UAH 153.4, and medical devices at UAH 40.6.
During the period under review, retail sales of medicinal products amounted to UAH 110 billion ($2.8 billion) and 623.8 million packages. Compared to the same period in 2023, there was an increase of 17.2% in UAH terms and 8% in dollar terms, while the volume in packages saw a slight decrease of 0.2%.
Quarterly dynamics show that in September 2024, the growth rate slowed compared to August. This was due to a surge in sales in August caused by a new wave of COVID-19, which peaked that month. Sales decreased in September, resulting in a reduction in growth rates in monetary terms to 13% from 24% in August, while the number of packages again fell by 4%. This package reduction is attributed to demographic factors, including migration and depopulation. According to United Nations estimates, as of October 15, 2024, the number of Ukrainian refugees exceeds 6.7 million, an increase of over 400,000 since the beginning of the year. Depopulation and the imbalance between mortality and birth rates have led to a population decline of approximately 200,000 people since early 2024.
Indicators of medicinal product sales growth show that in 2024, the market in UAH terms is primarily developing due to inflationary factors, reflecting sales volume changes through price increases.
In 2024, the trend toward increasing the share of prescription drugs in the overall pharmacy sales structure continues. Regarding the balance of domestic and foreign medications, it is worth noting that the share of Ukrainian drugs slightly increased in monetary terms, while the share of imported drugs increased in terms of packages.
According to the ATC-2 classification, all top 10 groups showed growth in monetary terms. The highest growth rates were recorded for antidiabetic drugs and antibiotics.
As of the first nine months of 2024, the leaders in terms of retail sales of medicinal products and dietary supplements in monetary terms were three Ukrainian companies: Farmak, Darnitsa, and Kyiv Vitamin Plant. The Viola company, which has significantly increased its market share in recent years, also made it into the top 20.
In the retail segment, Nurofen, Xarelto, and Nimesil were the top-selling brands among medicinal products.
In the distribution market for the first nine months of 2024, BDM, Optima-Pharm, and Venta LTD were the leaders in “pharmacy basket” product supplies to pharmacies. Competition among the leading players in this segment remains high, and leadership positions continue to shift.
The Ukrainian economy continues to recover from the severe losses caused by the full-scale invasion. The Ukrainian government forecasts economic growth in 2024 at 3.5%, while international institutions anticipate slightly lower growth rates of 3–3.2%. The government’s 2025 forecast sets GDP growth at 2.7%, while the NBU has a more optimistic forecast of 4%. However, since international organizations have downgraded their forecasts for Ukraine in 2025, Ukrainian experts may also revise their expectations.
The well-being of the population remains a crucial factor for the pharmaceutical market, as it is the primary source of market funding. The NBU forecasts a 16% increase in nominal wages in 2024 and a 10% increase in real wages. In 2025, wage growth is expected to slow to 14.6% in nominal and 5.8% in real terms.
The pharmaceutical market also shows steady growth. Despite a shrinking population, consumption in physical terms will likely remain at the previous year’s level by the end of 2024. However, in monetary terms, pharmacy sales of medicines are expected to grow by 18.7%, according to expert forecasts. The forecast for 2025 anticipates a 16.1% growth in UAH terms and a 1.4% growth in physical terms.
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