It has been reported that the long-term industry outlook for world pharmaceutical packaging demand is projected to increase annually over the next 4 years to over $34 billion. This will amount to an increase of approximately 5.9 percent annually. Western Europe, the US and Japan will continue to account for nearly three fourths of demand. This growth will occur on several fronts: internationally, through technological advances, and the demand for specific components. The US has been impacted by the international growth and has had several plant closings in the past year.
Manufacturing for pharmaceutical sector in the U.S. has continued to decrease with most major companies closing facilities in the U.S. It has been reported that many of the factors for the downturn is primarily from the numerous lawsuits filed in recent years. Industry sources indicate that this downturn has forced some of the larger pharmaceutical companies into closing facilities (approximately 15 in all) over the last year. These companies include Eli Lilly, Johnson & Johnson, GlaxoSmithKline and Pfizer. While these companies remain in business, either manufacturing on a smaller scale or opening facilities outside of the U.S, the abundance of equipment from these closings entering the used market has caused an impact on values. In some cases, equipment utilized in the manufacturing of pharmaceutical packaging products in high demand would not be affected by the decline in values and would have the inverse effect.
Blister packaging processing equipment will benefit with the advances in changeover features making this packaging process cost efficient in small volume drug applications. In addition to blister packaging, a boost in demand for pouches and strip packs will continue to effect equipment upgrades and modifications to meet these needs. The segment of the industry that will perform below average due to the competition from pouches and plastic dispensing bottles will be medication tube packaging.
New developments in digital printing technology of labels will foreseeably have a significant impact on the industry. They can shorten labeling lead times by more than 50%. Additionally, labels can be printed as needed, more quickly and with less overruns. This technology also enables companies to remain nimble in reacting to changes in market conditions, enabling new flexibility that traditional printing methods cannot. The effect of these new capabilities, such as serialized coding, RFID and watermarks, is a safer packaging with better monitored quality.
China is expected to have the strongest growth during the next four years based on the rapidly expanding pharmaceutical manufacturing capabilities. India and Brazil will also evolve into fast growing markets, especially in the area of generic, ethical drugs. The easing of government-imposed drug price controls and greater export market penetration will have a favorable impact on the sales of pharmaceutical packaging in Japan. The diversification of available products internationally will be consumed by the U.S. as the largest consumer of pharmaceutical packaging.
Global market growth will be led by child-resistant, senior-friendly and dispensing closures. The demand for closures and accessories is expected to exceed $10 billion due to the demand for these products and stricter government and industry standards, specifically geared towards safety and ease of use. Additional security packaging and the use of holograms will be emerging to assist in the minimizing of drug industry related risks.
With a black market for counterfeit drugs expected to increase to $75 billion by 2010, the pharmaceutical industry is looking for technologically driven solutions. Some new security measures being considered include radio frequency identification tags, barcodes and 3-D holograms, similar to those used in the printing of money. It is thought that this will make pharmaceutical packaging almost tamper-proof, since there are only a limited number of companies capable of creating the new packaging, and “copying” is practically impossible.
Across the packaging industry in general, sustainability has become a focus. Companies are driving to more sustainable packaging designs that are healthy, efficiently produced and recyclable. According to a recent report published by Packaging Digest, 87% of respondents reported that at least some of their current customers are asking for or requiring sustainable packaging. This will result in increased demand for new designs and technology.
Early reports demonstrate that primary pharmaceutical packaging containers will increase 6.5% annually through 2011 to nearly $24 billion. The strongest increase in the manufacturing sector will be for prefillable inhalers and prefillable syringes. The plastic bottle segment of the industry will remain the largest share in global demand based on low cost, availability, quality and design improvements. Blister packaging will generate a stronger growth in global demand then it had in the past due to clinical trials, compliance, adaptability to unit dose and over-the-counter sales.