International trade in medicinal and pharmaceutical products


Data from May 2018

Planned update May 2019

Highlights
The United States and Switzerland were the EU's main trading partners for medicinal and pharmaceutical products in 2017.
Among the EU Member States, Germany was the largest exporter (EUR 40 billion) and importer (EUR 14 billion) of medicinal and pharmaceutical products in 2017.

EU-28 exports, imports and trade balance in medicinal and pharmaceutical products, 2002-2017

This article is part of an online publication providing recent statistics on international trade in goods, covering information on the EU's main partners, main products traded, specific characteristics of trade as well as background information.

Full article

An increasing trade surplus

Figure 1 shows that extra-EU exports and imports in medicinal and pharmaceutical products grew almost every year between 2002 and 2017, reaching EUR 156 and 77 billion, respectively. Imports were dropping slightly only in 2003 and 2013. Even the financial crisis, which impacted trade in many other products, caused exports to fall by only EUR 437 million (0.6%) in 2008, while imports even grew that year. With exports growing more than imports, the trade balance grew from EUR 22 billion in 2002 to a record high of EUR 80 billion in 2017.

Figure 1: EU-28 exports, imports and trade balance in medicinal and pharmaceutical products, 2002-2017
(EUR billion)
Source: Eurostat (online data code: DS-018995)


Increasing share in total trade

Between 2002 and 2008 the share of medicinal and pharmaceutical products in total extra-EU trade remained fairly stable (Figure 2). In 2009, the share of exports increased by 1.1 percentage point (pp) and imports by 1.8 pp. This was not caused by an increase of trade in medicinal and pharmaceutical products but rather by the decline in total trade. Since 2009 the shares have been fluctuating but there is a clear overall growth. Since 2002 the share for exports has grown by 1.2 pp, while the share for imports has grown by 2.8 pp.

Figure 2: Share of medicinal and pharmaceutical products in total extra-EU trade, 2002-2017 (%)
Source: Eurostat (online data code: DS-018995)

United States and Switzerland remain the top EU partners

The United States stands out as the EU’s main trading partner for medicinal and pharmaceutical products in 2017 (Figure 3). Exports to the United States (31.1 %) are almost a third of all EU exports and are followed at some distance by Switzerland (13.4 %), China (6.1%), Japan (5.2 %), Russia (4.6 %) and Canada (3.0 %). Imports to the EU are dominated even more by the United States (40.0 %) and Switzerland (34.4 %). The other top six import partners are Israel (5.2 %), Singapore (4.5 %), China (4.1 %) and South Korea (2.5 %). Since the United States and Switzerland are the two largest trade partners, the development of their trade in medicinal and pharmaceutical products with the EU is discussed separately.

Figure 3: Main extra EU-28 partners for exports and imports of medicinal and pharmaceutical products, 2017
(%)
Source: Eurostat (online data code: DS-018995)

Trade with the United States between 2002 and 2017

Figure 4 shows the development of trade in medicinal and pharmaceutical products between the EU and the United States from 2002 to 2017. In this 16 year period exports grew by EUR 30 billion, falling only in 2008, 2013 and 2016. In 2015, there was an exceptionally high increase of EUR 14 billion, accounting for almost half the growth in the whole period. Imports in this period grew by EUR 18 billion, falling in 2003, 2005, 2007, 2013 and 2017. Similarly to exports, there was a particularly high increase of EUR 7 billion in 2015. Measured as average annual growth over the period 2002 to 2017, exports grew by 6.5 % per year and imports grew by 5.6 % per year. Since 2002 the EU has had a trade surplus with the United States, peaking at EUR 19 billion in 2015 and dropping to EUR 18 billion in 2017.

Figure 4: EU-28 trade with the United States in medicinal and pharmaceutical products, 2002-2017
(EUR billion)
Source: Eurostat (online data code: DS-018995)

Trade with Switzerland between 2002 and 2017

Figure 5 shows the development of trade in medicinal and pharmaceutical products between the EU and Switzerland from 2002 to 2017. In this 16 year period exports grew by EUR 15 billion, which was half as much as for the United States. It dropped only in 2003 and 2008. The largest increase (EUR 5 billion) occurred in 2017. Imports in this period grew by EUR 17 billion, which was only EUR 1 million less than the increase of imports from the United States. Only in 2003 was there a decrease in imports. Measured as average annual growth exports grew by 8.7 % per year, while imports grew by 7.2 % per year. Since 2002 the EU had a trade deficit with Switzerland, peaking at EUR 10 billion in 2016, which was halved to EUR 5 billion in 2017.

Figure 5: EU-28 trade with Switzerland in medicinal and pharmaceutical products, 2002-2017
(EUR billion)
Source: Eurostat (online data code: DS-018995)

Main partners by Member State

The United States and Switzerland dominate extra-EU imports (Figure 6). With the exception of South Korea, which is the main partner for Croatia and Hungary, and India, which is the main partner for Malta, either the United States or Switzerland is the main partner for the other 25 Member States. China appeared thirteen times as one of the top three import partners, while no other country appeared in the top three more than five times.

Figure 6: Top 3 partners for extra EU-28 imports of medicinal and pharmaceutical products by Member State, 2017 (%)
Source: Eurostat (online data code: DS-018995)

There is more variety in export partners (Figure 7) where we find seventeen different partners. Proximity and historical ties seem to play an important role, with Russia being the top partner for a number of Member States in the Eastern part of Europe. Similarly, we find Belarus for both Estonia and Lithuania and Serbia for Bulgaria, Hungary and Slovenia. The Netherlands, thanks to its ports and status of a transport hub, have the most fragmented export market with its top three partners accounting for only 22 % of its extra-EU exports.

Figure 7: Top 3 partners for extra EU-28 exports of medicinal and pharmaceutical products by Member State, 2017
(%)
Source: Eurostat (online data code: DS-018995)

Imports and exports by Member State

Table 1 shows that, amongst the EU Member States, Germany accounted for a quarter of all extra-EU exports (EUR 40 billion) followed at some distance by Belgium (EUR 20 billion), Ireland (EUR 18 billion), the United Kingdom and France (both EUR 15 billion). Six countries had shares higher than 10 % for medicinal and pharmaceutical products in their total extra-EU exports. These were Ireland (30 %), Denmark (23 %), Belgium (19 %), Slovenia (14 %), Croatia (11 %) and Austria (10 %).

Germany (EUR 14 billion) was also the largest importer followed by Belgium (EUR 13 billion) and the Netherlands (EUR 11 billion)[1] . Ireland (18 %), Austria (13 %) and Belgium (10 %) had high shares of medicinal and pharmaceutical products in their total extra-EU imports.

Table 1: Trade in medicinal and pharmaceutical products by Member State, 2017
(EUR million and %)
Source: Eurostat (online data code: DS-018995)

Data sources

This article is based on data available in the Eurostat COMEXT database for EU Member States and in the United Nations COMTRADE database for non-EU countries.

A code (such as ‘DS_018995’) is inserted as part of the source. This code allows the reader to easily access the most recent EU data on the Eurostat website. Note that data on the website is frequently updated and may also be more detailed or have a different measurement unit. It should also be noted that European statistics on international trade in goods are compiled according to the EU concepts and definitions and may, therefore, differ from national data published by Member States.

Product classification

Division 54 'Medicinal and pharmaceutical products' of the Standard international trade classification revision 4 (SITC Rev. 4), is made up of the sub-groups:

  • 5411 ‘Provitamins and vitamins (not put up as medicaments)’;
  • 5413 ‘Antibiotics (not put up as medicaments)’;
  • 5414 ‘Vegetable alkaloids (not put up as medicaments)’;
  • 5415 ‘Hormones, prostaglandins, thromboxanes and leukotrienes’;
  • 5416 ‘Glycosides; glands or other organs; antisera, vaccines;
  • 5419 ‘Pharmaceutical goods, other than medicaments’;
  • 5421 ‘Medicaments containing antibiotics’;
  • 5422 ‘Medicaments containing hormones, etc., but not antibiotics’;
  • 5423 ‘Medicaments containing alkaloids, but not containing hormones etc. or antibiotics’;
  • 5429 ‘Medicaments not elsewhere specified’.

Unit of measure

Trade values are expressed in millions (106) of euros. They correspond to the statistical value, i.e. to the amount which would be invoiced in case of sale or purchase at the national border of the reporting country. It is called a FOB value (free on board) for exports and a CIF value (cost, insurance, freight) for imports.

A bias in the geographical allocation of extra-EU flows

Extra-EU imports and exports are reported by the Member State where the customs declaration is lodged, usually the place where the goods cross the EU external frontier (here referred to as the exit/entry Member State). This is not necessarily the Member State of actual import or export. The geographical allocation of an extra-EU flow is biased in the case where the entry/exit Member State is not the actual importing/exporting Member State. In such a case, the extra-EU trade will be allocated to the entry/exit Member State and the actual importing/exporting Member State will report only intra-EU flows with the exit/entry Member State. This issue particularly impacts the extra-EU imports of Member States having important ports for transhipment of goods like Antwerp in Belgium and Rotterdam in the Netherlands. This is why it is known as the ‘Rotterdam effect’.

Context

Pharmaceutical products are among the most important products within the chemicals sector (SITC section 5). Today, the pharmaceutical sector is extensively regulated at EU level in the dual interest of ensuring the highest possible level of public health and patient confidence in safe, effective and high-quality medicinal products, while continuing to develop a single EU market for pharmaceuticals in order to strengthen the European pharmaceutical industry's competitiveness and research capability.

The most common trade impediments faced by pharmaceutical exporters are a range of burdensome and costly registration, licensing and certification procedures. The EU aims to redress these through its bilateral trade agreements or by tackling individual barriers as part of its market access partnership.

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