Please Note: BMI is enhancing its risk analysis with a new scoring system following its acquisition of GeoQuant, a market-leading provider of political risk data. From March 27 2024, risk scores are inverted: zero now represents the lowest risk and 100 represents the highest risk. This allows for clearer, industry-standard assessments. For further details, please refer to our updated methodology document. Key View: Slovakia's pharmaceutical market has substantial growth potential. However, the government is focused on cost containment in pricing and reimbursement, as well as health prevention strategies. Some concerns remain regarding the transparency of reimbursement decisions made by health insurance companies, which often consider such requests on a case-by-case basis. Nevertheless, we expect that population ageing and price increases to drive growth of the country's medicine sales. Headline Expenditure Projections

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  Pharmaceuticals:A EUR2.2bn (USD2.4bn) in 2023 to EUR2.4bn (USD2.6bn) in 2024; +6.0% in local currency terms and +6.9% inA US dollar terms.A Local currency forecast maintained in relation to the previous quarter.

Pharmaceuticals Forecasts (Slovakia 2022-2028)

f = BMI forecast. Source: WHO, national sources, BMI Latest Updates

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  On May 28 2024, the European Commission sanctioned the 'Med4Cure' project, the first Important Project of Common European Interest in health, facilitating EUR1bn of public funds under more lenient state aid rules for drug discovery and advanced therapy products, involving 14 projects across Belgium, France, Hungary, Italy, Slovakia and Spain.

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  On May 3 2024, the Prime Minister of Slovakia Robert Fico announced cost-saving measures targeting a 1% GDP deficit reduction, focusing on health services and insurance provisions.

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  On March 4 2024, the Bratislava-based medtech startup, Powerful Medical, secured a EUR7.5mn investment from the European Innovation Council, with a EUR2.5mn grant and a EUR5mn investment, in recognition of its innovative AI-driven ECG platform, PMcardio, for accurate early diagnosis of cardiovascular diseases

Risk/Reward Index Despite being one of the most advanced pharmaceutical markets in the region, Slovakia presents relatively limited long-term opportunities for innovative drugmakers. This is reflected in its overall Risk/Reward Index score of 44 out of 100 for the quarter, though this figure remains above the regional average of 47.4. Regionally, Slovakia ranks 11th, above Russia and below Lithuania. While the country offers a stable and transparent operating environment, opportunities for revenue growth are restricted by cost-containment measures and unfavourable demographic trends. Key Economic View We expect Slovak real GDP to grow by 1.8% in 2024 and 2.9% in 2025, accelerating from 1.1% in 2023. Growth will be driven by falling inflation and ongoing fiscal largess, both of which will support household consumption. Delayed EU funding disbursals amid rule of law concerns and fiscal largess will weigh on investment activity, representing a serious downside risk to growth if suspended permanently. Key Political View On May 15 2024, Slovakia's Prime Minister Robert Fico was shot five times by an assailant. Fico, who has served as Prime Minister in the past and was re-elected in 2023 on a platform of social conservatism and nationalism, has been a controversial figure, with previous allegations of corruption and opposition to military support for Ukraine. Meanwhile, domestic tensions have risen over proposed government changes to public broadcasting, which critics argue could lead to government control over the media, although major opposition protests were canceled in light of the shooting.