Healthcare Bio Tech Food Agric. Page  1   2   3    The Healthcare Industry Current State The Domestic Market Heading towards Saturation    According to a Japan Pharmaceutical Manufacturers Association survey of 29 pharmaceutical companies listed on the Tokyo Stock Exchange, the pharmaceutical industry has been able to maintain relatively high growth over the past 10 years after the bursting of the economic bubble, while other industries have recorded large negative growth in sales and profits. The rate of growth in sales reported for the pharmaceutical industry during this period was 2 percent, while the operating earnings average saw a growth rate of 5 percent.    However, if we look at just the Japanese domestic market, it can be said that the pharmaceutical market is gradually moving towards saturation. The country's dwindling birthrate and aging population has placed Japan's national health insurance system to the jeopardy of collapse. The government is therefore trying to curb related healthcare costs, or expenditures for pharmaceutical drugs to be more exact, by implementing such measures as a National Health Insurance (NHI) price revision to be made once every two years. A Brake on the Administration of Large Doses of Pharmaceutical Drugs    The Diagnosis Procedure Combination (DPC) system was implemented in April 2003 at 82 hospitals in Japan that are certified as a "special function hospital" (hospitals that perform difficult surgery or provide cutting-edge treatment). Under this system, patients hospitalized in general wards are charged a fixed sum for a day's worth of treatment. In the case of the traditional fee-for-service system, patients were charged a predetermined amount per medical action, and there was no ceiling to the charges to be paid for the pharmaceutical drugs used in the course of treatment. However, a predetermined limit to the amount charged has been imposed on medical facilities under the DPC system. Hospitals, therefore, need to keep their spending within that limit, resulting in a brake on their use of pharmaceutical products. Major Pharmaceutical Companies Revving Up Exports National Cancer Center: Tsukiji Campus    Meanwhile, some major Japanese pharmaceutical companies have been making moves to expand their exports since the late 1990s as a measure against the stalemate in the domestic market. There are six Japanese companies, such as Takeda Pharmaceutical Company Limited and Eisai Co., Ltd., whose export ratios exceed 10 percent. The export ratios of these six companies (i.e. export of pharmaceuticals from Japan) have risen from 70 percent to 90 percent over the past 10 years. While the domestic market continues to remain sluggish, a gap between Japanese majors - with sales networks and R&D capabilities that allow them to develop business overseas - and leading medium-sized firms is gradually beginning to expand.