IMS Health Forecasts 5 to 6 Percent Growth for Global Pharmaceutical Market in 2007

IMS Health (NYSE: RX), the world's leading provider of market
intelligence to the pharmaceutical and healthcare industries, today
announced that it expects global pharmaceutical market growth of 5 - 6
percent for 2007, compared with 6 - 7 percent in 2006, as the market
continues to rebalance in light of changing market dynamics. According
to IMS's 2007 Pharmaceutical Market Forecast, global pharmaceutical
sales will expand to US$665 - 685 billion next year.

"In 2007, the market still will be absorbing changes that have
defined a new economic reality, one in which growth is shifting from
mature markets to emerging ones; new product adoption is not keeping
pace with the loss of patent protection by established products;
specialty and niche products are playing a larger role; and
regulators, payers and consumers are more carefully weighing the
risk/benefit factors of pharmaceuticals," said Murray Aitken, senior
vice president, Corporate Strategy, IMS.

The geographic balance of the pharmaceutical market continues to
shift away from the U.S. toward the world's emerging
markets--countries with a per-capita Gross National Income of less
than $20,000. These countries currently represent 17 percent of the
global market, but will contribute 30 percent of growth next year. In
emerging markets, the availability of healthcare is expanding, and the
need for treatments associated with chronic diseases more typically
found in developed countries is rapidly increasing.

Growth in the emerging markets is offsetting the slower growth
coming from the U.S. market, which will contribute about 36 percent of
total market growth in 2007, significantly less than the 54 percent it
contributed five years earlier.

The number of new product launches next year is expected to be in
the range of 25 to 35, comparable to this year's expected 30 launches.
However, with pharmaceutical companies increasingly developing
specialty products and treatments to serve niche markets, new products
are contributing less to overall market expansion than they have in
the past. Moreover, market expansion from new products is not keeping
pace with the loss of patent protection by older products. In 2007,
marketed products with a value over $16 billion will likely lose
patent protection, which comes on top of $23 billion of products that
lost protection in 2006.

Several sectors of the market are expected to register high levels
of demand in 2007, particularly biotechnology, with estimated growth
of 13 - 14 percent, specialist-initiated products with 10 - 11 percent
growth, and the generics market with 13 - 14 percent growth. In the
generics sector, growth is stemming from opportunity in several key
therapeutic areas and increased volume driven by cost-control
initiatives.

The total number of blockbuster products continues to grow and is
expected to reach 112 in 2007, up from 94 in 2005. In 2007, the
potential blockbuster products launched will be paliperidone for
schizophrenia, desvenlafaxine for depression and vildagliptin for
diabetes.

"Undoubtedly, the most powerful force rebalancing growth in the
worldwide market is pressure from public and private payers to limit
their expenditures on drugs," said Aitken. "Their influence is
offsetting much of the growth that stems from rising demand and
innovation. Manufacturers increasingly must strengthen the evidence
that their therapies deliver 'value for the money' based on direct
health outcomes."

Regional Forecasts

In the U.S., 2007 market growth is forecast to slow to 4 - 5
percent, compared to 6 - 7 percent expected in 2006. The Medicare Part
D prescription drug benefit has expanded the overall U.S. market by
nearly one percent in 2006, with a further uplift of 1 - 2 percent
expected through 2007 while formularies remain relatively
unrestricted. However, the loss of patent protection for several key
brands valued at $10 billion will significantly impact the U.S. market
next year, following the patent expiry of $19 billion in branded
products in 2006. Growth from new products will not be sufficient to
offset the volume of branded drugs that shift to generics.

In Europe, the top five markets (France, Germany, the United
Kingdom, Italy and Spain) combined are forecast to grow 3 - 4 percent,
down from the 4 - 5 percent pace expected in 2006. While these
countries see increased demand from an aging population, growth is
being affected by cost-containment measures, incentives for using
generics and increased scrutiny of the cost/benefit of drugs.

The Japan market is forecast to grow 5 - 6 percent in 2007, up
from an estimated 1 - 2 percent this year that resulted from the
government's biennial price cuts imposed on April 1, 2006.

Emerging markets, including China, India, Brazil and Turkey, are
growing over 10 percent in 2006 and will do so again in 2007, largely
due to their growing economies and broader access to medications.
Growth in China will be 15 - 16 percent and the market size will reach
$15 - 16 billion in 2007. Generally, locally manufactured generics
dominate these markets.

Therapeutic Classes

An aging population and improved diagnostics have increased demand
for oncology treatment--a challenge that the industry has met with a
strong flow of innovation. Science has changed the face of the
disease; survival rates are improving and some cancers are now
considered chronic illnesses or even preventable conditions.

Products used in the treatment of oncology are expected to reach
$40 - 45 billion in value in 2007, contributing nearly 20 percent of
total market growth. "Through 2007, this class will expand rapidly as
more patients gain access to treatment from a growing range of
therapies," noted Aitken. "But oncology products will eventually be
subject to tighter pricing and usage parameters as payers deal with
their mounting costs."

Among other major therapy classes, the lipid-lowering class
(including statins as well as Zetia(R) and Vytorin(R)) will grow to
$30 to 33 billion, reflecting an estimated 1 - 2 percent growth in
2007, down from 7 - 8 percent this year. While the 2006 patent losses
for simvastatin (Zocor(R)) and pravastatin (Pravachol(R)) will
continue to affect growth, increased public awareness of the efficacy
of lipid-lowering agents, broader patient screening and new
combination therapies will continue to drive demand.

Implications for Manufacturers

"Pharmaceutical companies have started to reinvent themselves in
response to market challenges, and they look very different than they
did just five years ago," commented Aitken. "But it is no longer
enough just to be responsive. To succeed, companies need to get ahead
of the dynamics that are rebalancing the market. This requires a
greater reliance on scenario-based planning, a sharper focus on
realizing productivity gains from sales and marketing expenditures,
and proving the value of medications as never before."

About the Forecast

The 2007 forecast for market and therapy performance is based on
extensive analyses by IMS consulting and forecasting experts. It uses
IMS Market Prognosis, a strategic market forecasting publication, and
IMS Therapy Forecaster, a unique forecasting system based on detailed
quantitative and qualitative methodologies. Combined, these two tools
deliver the most accurate and statistically robust insight into
pharmaceutical and healthcare trends in the world's largest markets
and most important emerging ones.

The forecasts take full account of key issues impacting the
pharmaceutical and healthcare industries. Additional factors that may
affect overall growth include major safety events resulting in product
withdrawal or prescribing restrictions; shifts in regulatory approval
standards from their current levels; the application of sudden cuts to
drug spending levels; and public health crises such as the Avian flu.
Growth is measured in constant dollars to avoid the influence of
currency exchange rates; sales are calculated at the ex-manufacturer
level.

About IMS

Operating in more than 100 countries, IMS Health is the world's
leading provider of market intelligence to the pharmaceutical and
healthcare industries. With $1.8 billion in 2005 revenue and more than
50 years of industry experience, IMS offers leading-edge business
intelligence products and services that are integral to clients'
day-to-day operations, including portfolio optimization capabilities;
launch and brand management solutions; sales force effectiveness
innovations; managed care and over-the-counter offerings; and
consulting and services solutions that improve ROI and the delivery of
quality healthcare worldwide. Additional information is available at
http://www.imshealth.com.