Pharma packaging growing market with openings for good ideas

Print 26 September 2013
Eric Palmer, FiercePharmaManufacturing

Private investment firm Frazier Healthcare made two significant buys last year to create a global contract packaging company because it sees big upside in that market niche. A new report on the future growth in pharma packaging says a move toward use of more contract operations like Frazier's PCI will be a big driver for those companies that make the plastic bottles, parental containers, blister packs, labels and other products that go into packaging the drugs needed worldwide.

A report from Transparency Market Research says the global pharmaceutical packaging market will churn out a compound annual growth rate of 5.6% between 2012 and 2018, reaching $73.04 billion that year. Not surprisingly, North America and Europe make up the largest piece of the market at about 60%, but the report says the fastest-growing region will be Asia Pacific, where governments' efforts to provide better public healthcare for an aging populace will drive demand for everything from plastic bottles to blister packs. The market in Asia Pacific is expected to reach $20.63 billion by 2018, more than 28% of the total global market.

Some companies have already jumped on those markets. Germany-based Schott Pharmaceutical Systems, which specializes in glass packaging, recently announced plans to expand its Hungarian site in Lukácsháza but also said it was working on expansions in Russia, India and China. A competitor, Gerresheimer AG, last year bought controlling interest in a pharma glass company in India.

The report says plastic bottles remain the biggest part of the market, at more than 20%, but parental containers are expected to be the fastest-growing segment as injected drugs make up a growing part of new drugs. Pre-filled syringes are expected to be one of the fastest growing segments.

Transparency Market Research sees drug regulations as continuing to be a big factor in what sells but also sees openings for manufacturers with good ideas around packaging that can ensure quality, provide tamper resistance and deter counterfeiting. Nano-enabled packaging that goes beyond the basics, such as providing alerts, could provide opportunities.

Novartis ($NVS) and consulting firm Xcenda found that patients who got their Diovan HCT in simple blister packs with calendars bought refills 5 days sooner than those getting them in traditional amber bottles and stayed on their meds 22 days longer over the course of a year. Some companies are working on bottle caps that beep to remind patients to take their meds.

But all of this upside does not come without risks. The big ones will be the volatility and availability of raw materials, the report says.

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