Knowledge

The Swiss pharmaceutical industry

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The pharmaceutical industry has a key role in the Swiss exports industry. In 2014, pharmaceuticals exports amounted to more than 70 billion CHF, which means that about one third of money earned abroad by Switzerland comes from pharmaceutical products.

The pharmaceutical sector has contributed to the growth of the Swiss economy over the last two decades, with an annual average market growth of 9.1% .

More than 40,000 people are employed in the pharmaceutical industry, which account for almost 1% of all jobs available on the Swiss labor market. Companies form other business sectors can also benefit from economic success of this industry.

As a result of strong capitalization, extensive innovation activities and high production efficiency, Swiss pharmaceutical companies are very competitive, establishing their position as leaders in this field.

Impact on other Swiss industries

To manufacture its products, the pharmaceutical industry requires capital and labor, but it also needs the input of other goods and services, boosting the economical growth of other industry sectors as well. Every job in the pharmaceutical industry generates other three jobs in companies of the industries that are benefiting indirectly from the research and production of this sector.

Swiss pharmaceutical exports

The most important market for Swiss pharmaceutical products is, without a doubt, the European Union. On the EU market, exports amounting to over 38 billion CHF were sold in 2014, meaning more than half of the total exports. However, demand for Swiss pharmaceutical products varies in the EU. Most exports went to Germany (25%), Italy, France and Austria. Important quantities were also exported to Spain and the UK.

On the US market, in the same year, products valued at more than 11 billion CHF were sold. During the economic recovery, following the financial and banking crisis in 2008, the US became the most important market for Swiss pharmaceutical products.

Other important export market is Japan, with exports amounting to approximately 2.5 billion CHF in 2014. However, the all –time high of Swiss pharmaceutical exports was reached in 2009, as over the last years the figures have somewhat declined. The demand for Swiss pharmaceutical products is also on an ascending trend in Brazil, Russia, India and China.

Important facts for the Swiss pharmaceutical industry

Switzerland has become over the years an important hub for companies operating in this field. The most important region in the country for establishing a pharmaceutical company is Basel, where most of the workforce in the industry is employed.

Another important thing to consider is that most Swiss pharmaceutical companies made important contributions in the research and development field and an important number of companies hold patents. Most companies apply for dozens or even hundreds of patents each year.

Switzerland has more than 200 companies operating in the pharmaceutical field and it also represents the most important market when it comes to stock exchange for life science companies. Approximately a third of the Swiss stock exchange is comprised of foreign capital (mostly from Europe) invested by the life science businesses.

In 2015, several important pharmaceutical companies, such as Novartis, Roche or Pharma spent almost 7 billion CHF on research and development activities in this field. These figures correspond to almost 35% of their global research and development expenditures.

The dynamic of the worldwide chemicals market, with a high demand for high quality products, corporate strategies on improving efficiency and reducing costs could not have guaranteed the success of the Swiss pharmaceutical industry. Thus, Switzerland has created and maintained its place on the top of the field by using strong elements of innovation (due to R&D activities), technological and scientific know – how, highly skilled workforce and a favorable business environment, especially for companies investing in innovation and research.

Considering that the Swiss pharmaceutical industry registered the highest growth rate in Europe in this field, up to 9.1% each year, starting with the year 2000, the figures in exports on the European market and in the US, the pharmaceutical sector offers some of the most important business opportunities for entrepreneurs interested investing in successful endeavors.  

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