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Pharmaceutical Distribution in Europe

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    DEUTSCHE POST AG
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    Jackson, Mississipi
    Duns number
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    Pharmaceutical Distribution in Europe market report transcript

    Regional Market Outlook on Pharmaceutical Distribution in Europe

    Pharma Distribution: Austria

    Industry is expected to have low bargain and negotiation power, as the pricing mechanism is regulated (average margin of 10 percent) and a consolidated supply market (the top three wholesaler's share is about 77 percent).General practice is to engage with a single wholesaler; however, international manufacturers deal with more than one wholesaler, based on the product portfolio.

    Engagement Model

    • Single wholesaler for pharmaceutical products is usually adopted
    • Majority of the pharmaceutical distribution is through the channel of full-line wholesalers

    Distribution Services

    • Fee for service is the prevalent pricing model
    • Pharmaceutical companies are charged on a fixed commission basis by pharmaceutical wholesalers

    Wholesaler/Distribution Margin

    • The average margin for wholesalers is 10 percent

    Sales Incentives

    • Non-monetary incentives include training and business education

    Pharma Distribution: The Netherlands 

    Industry is expected to have medium bargain and negotiation power, as the pricing mechanism is negotiable by wholesalers (average margin of 8–12 percent), with a fragmented supply market (the top two wholesaler's share is 40–45 percent).Distribution to hospitals happens through either wholesalers or directly by manufacturers. For direct distribution to hospitals, pharmaceutical companies use wholesaler as logistics service providers.

    Engagement Model

    • Manufacturers engage with one to two full-line wholesalers for the distribution of products, and the minimum contract period of engagement is three years
    • Wholesalers act as a pre-wholesaling distribution partner for direct DTP and hospitals

    Distribution Services

    • Fee for service is the preferred pricing model

    Wholesaler/Distribution Margin

    • Wholesaler's margin is unregulated and has no statutory markups on wholesale level, like other EU countries. Wholesalers have entered into a private negotiation with manufacturers
    • Wholesaler's margin is 8.5–11.8 percent.

    Sales Incentives

    • Sales incentives paid to wholesalers is around 10–15 percent of the sales volume

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