Germany: Europe’s Largest Pharma Market
Germany is one of the key focus markets for pharma, biotech and medtech Market Access as it has the largest population in Europe (around 84.5 million people covered by health insurance) and represents the biggest healthcare market in terms of value in the EU. In 2024, total statutory health insurance (GKV) expenditures on pharmaceuticals reached about €55.2 billion, making it the second-largest health expenditure after hospitals, comprising almost 17% of GKV spending1.
Volume vs. Value Dynamics
Growth in Germany’s pharma market is being driven more by high-value therapies than sheer prescription volume. The average cost per medicine pack has climbed dramatically. For instance, the average price per prescription pack rose from about €190 in 2014 to €588 in 2023 (over 3× increase), reflecting the impact of higher priced new drugs2. In particular, newly launched medications carry increasingly high prices: the average launch price for new drugs skyrocketed from roughly €1,600 in 2012 to €61,000 by 2024.
Meanwhile, volume usage has not exploded. Patent-protected drugs represent only around 7% of total defined daily doses prescribed as of 2023, but at the same time generics comprise just an estimated 18.7% of Germany’s pharma sales by value3. A small number of higher-priced branded drugs drive the lion’s share of revenue, while low-cost generics deliver most of the volume. It’s a key insight into the German pharma market: value growth is concentrated in specialty and innovative drugs, whereas generics provide broad access at lower cost.
Oncology and Orphan Drugs Fuel Rising Pharmaceutical Expenditures
Oncology and rare disease treatments have a significant value share in the German market. Although orphan drugs account for only 0.07% of all prescribed daily doses, they now make up 13.5% of statutory health insurance pharmaceutical expenditure4. In 2023, German spending on orphan-designated medicines exceeded €7 billion for the first time. These advanced therapies have greatly improved outcomes for patients with previously untreatable conditions and command premium prices. Thanks in part to the strong uptake of innovative oncology and orphan drugs, Germany’s overall pharmaceutical spending has been rising faster than the European average. However, with a stable 17% share of health expenditures going to medicines (a figure steady for years), German policymakers continue to use price regulation and high generic utilization (almost 80% of prescriptions)5 to ensure long-term spending sustainability.
Pharma Market Outlook: What’s Ahead for Germany in 2025 and Beyond
Looking ahead, Germany’s pharmaceutical market is expected to continue growing, albeit at a moderate pace. Fundamental drivers like an aging population and the rising prevalence of chronic diseases suggest steady demand for medicines. Industry forecasts anticipate mid-single-digit annual growth in the coming years, barring major policy changes. For example, the association of research-based pharma companies (vfa) projects the sector will expand about 2.5% in 20256.
Stay updated
Justin Stindt Consultants are closely monitoring all developments related to the Medizinforschungsgesetz (MFG, Act to Strengthen Medical Research) and will keep our clients informed of the latest changes. For more detailed insights and updates, visit our blog regularly.
Justin Stindt Consultants can help you with German Market Access
Justin Stindt Consultants is your consulting firm with experts who have extensive experience with Market Access in Germany. Our strong presence in the German market means that we can respond to the new law with agility and help you launch your asset seamlessly despite the changes and uncertainty.
Our consultancy has helped many clients by engaging the G-BA for scientific advice meetings and developing benefit assessment AMNOG dossiers. Our consultants also support price negotiations. For medical devices and digital health apps, our agency supports dossiers and negotiations. Many of our consulting firm’s clients have found Germany the place to start for Market Access in Europe and decided to enlist our agency as partner of choice given our footprint and experience in the German market.
Contact our experts today to learn how our agency can tailor our services to meet your unique needs to enable Market Access in Germany.
Sources
[1] https://www.vdek.com/presse/daten/d_ausgaben_arzneimittel.html
[2] https://www.aok.de/pp/gg/daten-und-analysen/gkv-arzneimittelkosten/
[3] https://efpia.eu/media/2rxdkn43/the-pharmaceutical-industry-in-figures-2024.pdf
