March 2, 2024
United States Pharmaceuticals Market

United States Pharmaceuticals Market Is Expected To Be Flourished By High Investment In R&D By Pharmaceutical Companies

The United States pharmaceuticals market consists of prescription and over-the counter drugs, biologics, vaccines, and medical devices, which are primarily used for the diagnosis, treatment, mitigation and cure of various diseases like cancer, diabetes, infectious diseases and cardiovascular diseases in humans. Rising prevalence of chronic diseases and changing lifestyle patterns have increased the overall demand for pharmaceuticals in the country. Additionally, increased investment in research and development activities by major pharmaceutical companies to develop novel biologics and targeted therapies for cancer and other rare diseases is contributing to the growth of the market.

The United States pharmaceuticals Market was valued at US$ 599.47 billion in 2023 and is expected to exhibit a CAGR of 8.6% over the forecast period 2023 to 2030, as highlighted in a new report published by CoherentMI.

Market Dynamics :

The rising prevalence of chronic diseases and adoption of innovative biologics and targeted therapies are expected to drive the growth of the United States pharmaceuticals market over the forecast period. According to the Center for Disease Control and Prevention, over 124 million Americans had one or more chronic health conditions and it was estimated that nearly 80% of all health care spending is associated with treating chronic diseases. Increased spending by pharmaceutical companies towards research and development of novel biologics and targeted therapies for the treatment of cancer and rare diseases is also projected to fuel the market growth. For instance, in 2020, top 10 global pharmaceutical companies invested over US$ 163 billion in research and development activities.

Furthermore, favorable government initiatives to promote pharmaceutical innovation and reforms in healthcare policies are creating lucrative opportunities for the market players. The government provides funds and tax incentives to stimulate development and supply of novel pharmaceuticals in the country. For example, in 2018, the Cancer Moonshot initiative provided US$ 1.8 billion funding for accelerating cancer research.

Segment Analysis:

The United States pharmaceuticals market is segmented into prescription and OTC drugs. The prescription drugs segment dominates the market and holds around 75% share currently. This segment is dominating as chronic health conditions like cancer, diabetes, cardiovascular diseases are prevalent in the country which requires long term prescription medication. Brand name drugs capture around two-third market share within the prescription drugs segment due to strong marketing by big pharmaceutical companies and consumer loyalty towards brands.

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

PEST Analysis:

Political: The pharmaceutical industry receives strong support from the US government through various initiatives to boost generic drug production and R&D for innovative drugs. However, frequent policy changes and pricing control pressures impact the industry.
Economic: Strong economic growth coupled with rising disposable incomes increases healthcare spending in the country. The US spends around 17% of its GDP on healthcare annually, highest in the world.
Social: With increasing life expectancy and lifestyle changes, the prevalence of chronic diseases is rising rapidly in the country. Social security programs like Medicare also support healthcare access for elderly population.
Technological: Pharmaceutical companies focus on developing targeted therapies using cutting-edge research in genomics, AI/ML and advanced drug delivery systems. 3D printing and digital technologies help improve supply chain efficiency.

Key Takeaways:

The United States Pharmaceutical Market Size is expected to witness high growth. The global United States pharmaceuticals Market is estimated to be valued at US$ 599.47 billion in 2023 and is expected to exhibit a CAGR of 8.6% over the forecast period 2023 to 2030.

The Northeast region currently accounts for around 30% market share led by states like New York, New Jersey owing to concentration of pharma companies and healthcare R&D centers in this region.

Key Players operating in the United States pharmaceuticals market are Johnson & Johnson, Pfizer, Merck & Co, Abbott, Eli Lilly and Company. The market is consolidated with these top players accounting for over 50% share. Pfizer leads the prescription drug sales, while Johnson & Johnson dominates the generics space.

*Note:
1. Source: CoherentMI Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it