HDMA Factbook: 2011 health product sales reach $294 billion

Pharmaceuticals are primary driver

ARLINGTON, Va. — Healthcare product sales through the nation’s primary healthcare distributors hit a record high of $294 billion in 2011, according to the 2012-2013 HDMA Factbook released Friday. Specifically, pharmaceutical products moved by distributors represent approximately 90% of sales in the United States.

“This year’s Factbook continues to provide valuable metrics on distributor efficiencies,” stated Karen Ribler, EVP 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.”  

According to the Factbook, 2011 distributor sales, which increased by nearly 7% since 2010, outpaced the total growth of the pharmaceutical market during the same year. As IMS Health data indicated, pharmaceutical industry sales grew by 4% 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, HDMA concluded.

While the majority of traditional distributors’ net sales — 98% — 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% over 2010 to represent 11% of total distributor sales, while branded pharmaceutical sales have decreased by nearly 2% to reach nearly 75% of sales. Sales of prescription specialty products through distributors also fell slightly by 1% to account for 12% 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.

The Factbook noted that distributors’ profit margins grew slightly, with net profit after taxes to net sales increasing to 1.2% (from 1.1% in 2010).           

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’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; RDC-Rochester Drug Cooperative; Teva Pharmaceuticals USA; EXP Pharmaceuticals Corp.; Ranbaxy Pharmaceuticals; and Smith Drug Company, Div. J M Smith Corporation.

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