The Healthcare Market in Germany - Opportunities for Foreign Companies
Germany is Europe's largest healthcare and life sciences market. This makes it the preferred choice for many international companies preparing to expand their footprint.
Germany’s growing markets are driven by various global trends. Social developments like demographic change, and technological trends such as digitization are some key examples. Science and innovation conducted in Germany frequently leads to commercialization of cutting-edge technology. This is the case especially in the life sciences sector, which comprises a variety of high-tech sectors like molecular diagnostics, (bio-)pharmaceuticals and biomaterials as well as medical devices.
It is our mission to help your company grow in Germany. Discover opportunities for your project in Germany. See latest market data and developments and get the insights that will help you set up shop in the German healthcare and life sciences market.
Germany’s healthcare market is No. 1 in Europe by market volume, number of patients, medical technology manufacturers, and healthcare providers.
The healthcare market in numbers
Healthcare spending in Germany exceeded EUR 457 billion in 2021, not including expenditure for wellness and fitness. The market has grown at a rate of 5.4 percent over the past five years. With 7.7 million employees and exports in excess of EUR 158 billion, healthcare is one of the largest economic sectors in Germany.
Health insurance coverage is mandatory in Germany. Insurance premiums are shared by employers and employees. The vast majority of the population is enrolled in public health insurance plans. About ten percent choose private providers. Both publicly and privately insured can choose their provider. Currently, there are 96 public and 41 private health insurance companies operating in Germany (2023).
Inpatient care in Germany
More than 1,800 hospitals with nearly 500,000 beds operate in Germany – not including rehabilitation or elderly care facilities. The overall number of medical hospitals is declining as smaller general hospitals close or merge with other hospitals to increase efficiency.
The share of privately operated hospitals continues to rise
Every year companies participate in thousands of research projects with other partners from industry and scientific institutions, emphasizing Germany’s reputation as a leading environment for healthcare and life sciences. Along the entire value chain – from R&D through scale-up and production to sales and marketing – Germany is known for its outstanding capabilities, resources, and infrastructure.
Germany is home to more than 30 specialized cluster networks focusing on medical technology. Dedicated cluster management teams help obtain funding for joint R&D projects, provide shared facilities, and organize educational training programs for their members.
Germany’s “BioRegions” are regional initiatives for the advancement of modern biotechnology. Over the past three decades, these biotechnology clusters have developed to become Europe’s leading R&D hubs. Each region specializes in particular areas and facilitates collaboration between universities, R&D institutes, and private sector companies.
Find the latest news about current developments in Germany's healtcare market and its industries. Get our latest publications for free download and see where in the wolrd you can meet our experts.
Germany’s biopharmaceuticals sector increased turnover by 14 percent last year, with the country’s biotech companies as important actors in the fight against Covid-19.
Medical biotech nation Germany
Germany is the world’s leading medical biotech nation behind the US. The industry’s strength comes from the presence of long-established and start-up companies alike. Industry, government, and the research sector are pulling in one direction to build on the thriving sector’s already strong market foundations. With the largest amount of biotech companies in Europe, world-class research infrastructure, and internationally renowned scientists, Germany has firmly established itself as an international medical biotechnology hub.
Innovation infrastructure
Science and industry need to work together closely in order for innovations to be commercialized successfully. German bioclusters are proving to be important new technology impulse givers in this respect.
Germany's bioregions
The BioRegions are regional initiatives for the advancement of modern biotechnology in Germany. Over the past three decades, these biotechnology clusters have developed to become Europe’s leading R&D hubs. Each region facilitates collaboration between universities, R&D institutes and private sector companies. Around 30 BioRegions are active members of AK Bioregio, whose goal is to advance the German biotechnology sector by coordinating and promoting local activities. AK BioRegio advances the exchange between regional initiatives and relays its expertise to political decision makers.
Investors benefit from easy access to networks and funding for research projects. The BioRegions also include technology parks tailored to the specific needs of biotechnology companies. Commonly known as BioParks, these centers offer an ideal infrastructure - including lab space and clean rooms - as well as a range of services for both start-up and well established companies.
In-vitro diagnostics (IVDs) are a crucial part of modern medicine: laboratory based tests performed on biological samples provide information that is key for the prevention, treatment and management of diseases. Today, around two third of all clinical diagnoses are made thanks to IVD´s. With more than EUR 2 bn in annual revenue, Germany represents the largest IVD market in Europe and second worldwide behind the USA.
Molecular diagnostics (Dx) has emerged as one of the largest and fastest growing sectors of the IVD industry. Molecular Dx already enjoys more than 10 percent share of the entire German diagnostics market and boasts a growth rate more than twice that of the entire IVD market as such.
Big pharmaceutical and smaller biotechnology companies alike are focusing on drug discovery and development of medicines produced by biotechnological processes.
Small molecules are moving to the background in medicine development as the result of a major paradigm shift to biopharmaceuticals. This is reflected by the increasing sales of biopharmaceutical products worldwide.
According to a report by Boston Consulting Group and the Association of Research-Based Pharmaceutical Companies (vfa), sales of biopharmaceuticals in Germany increased to EUR 10.2 billion in 2017 (growth of 10.3 percent compared to 2016). Growth was seen in nearly all fields of application, particularly in drugs treating immunological (e.g. rheumatic) diseases and cancer.
The number of biopharmaceuticals in clinical development increased from 604 in 2014 to 639 in 2017, reflecting continued high investment in the biopharmaceutical pipeline.
In 2017, a record-breaking 51percent of all new drug approvals were biopharmaceuticals. By the end of 2017, a total of 274 biopharmaceutical drugs were approved for the German market – more than ever before. Divided into pharmacological classes, vaccines and monoclonal antibodies are leading in numbers with 23percent each, followed by insulin with 14 percent.
Demand for innovative medical technology solutions continues to grow as we live longer, healthier lives. In 2018 spending on medical technology in Germany reached an estimated record high of EUR 36 billion.
Market growth potential
This creates growth opportunities for the medical technology industry, which in Germany is made up almost entirely of small and medium-sized companies. The positive outlook in the domestic market, combined with strong exports of “Medtech Made in Germany,” resulted in a 10.4 percent domestic industry turnover increase. The following information is designed to help international manufacturers understand how to expand in the German healthcare sector as well as outlining the range of support services provided by GTAI.
Spotlight: Germany’s medical aids market
Medical aids represent one major segment of the German medical technology market. Megatrends like demographic change and the increasing number of people in need of care stimulate the demand for medical aids in Germany.
Diverse medical aids market
The medical aids sector encompasses a wide range of different product groups in the area of assistive devices and mobility equipment – from prostheses, orthoses, walking aids and wheelchairs through to incontinence treatments and visual and hearing aids amongst other things. In general, the purpose of medical aids is to ensure the successful treatment of a disease, to prevent an imminent disability or balance an existing disability of an individual.
Rising market volume
In 2020, the number of care recipients in Germany exceeded 4.5 million. Expenditures for medical aids are continuously on the rise growing by 3.7 percent per year between 2009 and 2019 to reach a new high of EUR 20.6 billion. A substantial proportion of expenses is reimbursed by health insurance providers. In 2019, spending by statutory health insurance companies on medical aids increased by 6.6 percent to EUR 9.4 billion.
Trends and reimbursement
For further information about the medical aids segment and reimbursement scheme, please have a look at our “Germany's Medical Aids Market” webinar:
Germany's Digital Care Act (DVG) paves the way to broad usage and reimbursement of digital health applications - providing access to digital health applications on prescription to 73 million insured Germans.
The healthcare industry in Germany is undergoing massive digitalization. By 2025, the German digital health market is projected to be worth EUR 57 billion.
Digital Health Applications
Individuals with health insurance are entitled to coverage benefits for digital health applications (DIGAs) where those applications meet the following characteristics:
Medical products of class I or IIa under MDR
Main function is based on digital technologies
DIGAs assist the process of detection, monitoring, treatment and alleviation of injuries and compensate diseases and disabilities
DIGAs are used either by the patient or jointly by the patient and the care provider, which means application can solely be used for patient treatment
“Fast Track” into the DIGA directory
In order to bring digital health applications into the statutory health system, a “Fast Track” process has been created to make sure that all of the 73 million Germans with public health insurance (90%) have access to these applications.
The developer submits an application to the BfArM - the Federal Institute for Drugs and Medical Devices – which also advises the developer. If the application fulfils the general requirements (safety, quality, functionality, privacy, and data security) and positive care effects (medical benefits, structural & procedural improvements), it can be listed in the DIGA directory. Structural and procedural improvements include: access to care, adherence, health literacy or overcoming gaps in transition from one type of care to another.
This means that the developer can already provide evidence which shows the positive care effects. This process takes up to three months. The developer then negotiates a price with the umbrella organization of statutory health organizations. If the developer cannot yet provide evidence for the positive care effects a 12 month trial period is conducted, which can be used to provide a hypothesis and an evaluation concepts for the expected positive care effects (producer bears cost).
The DIGA can then be listed in the directory for 12 months. During this time, the producer can collect data and show the positive care effects its DIGA has. BfArM decides on the final listing and the producer negotiates a price with the umbrella organization of statutory health organizations.
Telemedicine
Telemedicine combines telecommunication and information technologies to provide remote health care and other health-related services. A number of telemedicine initiatives have sprung up in recent years, with about 200 telemedicine projects currently active in Germany. Detailed information about ongoing and implemented projects is provided by Deutsche Telemedizinportal, part of the eHealth Initiative founded by the Federal Ministry of Health. The aim of the initiative is to pave the way for meaningful applications past the project phase into standard care.
“Time is Brain” - Telemedicine Closes Gaps in Health Care Provision
One example that vividly illustrates how digital health is not just about saving money but also lives is the use of telemedicine solutions for the treatment of strokes. Germany has a dense network of stroke units and tele-stroke units. There are more than 300 hospitals with certified stroke units in Germany. Tele-stroke units complement the high quality and comprehensive medical care of strokes in areas where the admission to a hospital with a stroke unit would take too long. Since 2011, tele-stroke units are also certified to ensure the high quality of these telemedicine networks.
Combining cutting edge-innovation, a long tradition as the “world´s pharmacy” and continuously growing demand for healthcare products, Germany is the ideal location for pharmaceutical R&D, production, and sales of medicines.
Driven by trends such as demographic change, a rise in chronic diseases and an increasing emphasis on prevention and self-medication, Europe’s biggest pharmaceutical market is growing faster than the German economy. Germany belongs to the world’s leading clinical trials locations and - based on R&D investment and patent application levels - is the leading pharmaceutical innovation location in Europe.
The country is the second largest exporter of medicinal products and ranks among the top pharmaceutical producers worldwide. In light of the global need for personalized medicine, Germany has also evolved into one of the main suppliers of novel biopharmaceuticals.
Located in the heart of Europe and benefiting from excellent infrastructure and a highly skilled workforce, Germany offers attractive opportunities and a favorable investment climate for pharmaceutical companies planning to expand internationally.
Germany's pharmaceutical industry in numbers
Germany constitutes the major European pharmaceutical market and the fourth largest worldwide.
In 2020, pharmaceutical industry sales in Germany increased by 6.7 percent, reaching EUR 49.5 billion (ex-manufacturer prices)
Approximately 550 pharmaceutical companies are located in Germany. SMEs constitute the backbone of the economic sector, with around 91 percent of drug manufacturers having less than 500 employees. Overall, the German pharmaceutical industry has a workforce of 143,000 people (2020).
Germany generated production value of EUR 32.4 billion in 2020, making it one of the leading pharmaceutical manufacturing locations in the EU.
In 2020, the pharmaceutical industry in Germany invested almost EUR 7.7 billion in R&D. The sector shows the highest research intensity across all major German industries – about 14.4 percent of revenues were reinvested in R&D in 2020.
Top 10 of the most important indications (ATC-3) on the statutory health insurance market in terms of sales (2016)
Indication areas (ATC-3)
EURO in mil.
% vs. previous year
% share of total sales
% share of total quantity
Total
38,676.60
3.13
100.00
100.00
L04B Anti-TNF products
2,127.5
8.15
5.50
0.07
N07A Multiple sclerosis Product
1,730.90
- 0.91
4.48
0.08
A10C Human insulin and analogues
1.394.70
1.15
3.61
1.76
L01H Antineoplastic protein kinase inhibitors
1,385.20
15.61
3.58
0.04
B01F Direct factor-Xa inhibitors
1,070.90
32.09
2.77
0.65
N02A Analgesics, Anaesthetic agents
1.061,70
3.18
2.75
1.18
J05B Virostatic agents, not for HIV
961.80
- 35.71
2.49
0.16
J05C Virostatic agents for HIV
961.50
3.68
2.49
0.09
L04X Other immunosuppressants
899.00
11.90
2.32
0.24
T02D Diabetes tests
833.50
- 1.97
2.15
3.66
Source: BPI 2017
Pharmaceutical market opportunities in Germany: Over-the-counter (OTC) market
Over-the-Counter (OTC) On average, revenues in the German OTC market increased by 3.3 percent per year between 2015 and 2020, exceeding EUR 10.7 billion in 2020. Around EUR 7.0 billion was generated in the non-prescription drugs segment and almost EUR 3.8 billion with health products.
Non-prescription drugs include pharmacy-only drugs as well as OTC drugs that may also be sold outside of pharmacies. Product groups that are not subject to pharmaceutical legislation - for example, food supplements – belong to the health products segment and can be sold by pharmacies as well as in the mass market (e.g. drugstores and supermarkets).
Traditional brick-and-mortar pharmacies enjoy a high level of trust among the German population and represent the main distribution channel for OTC products, followed by mail-order pharmacies and the mass market.
Remedies for the respiratory system, analgesics and products for the digestive system account for the highest share of OTC sales via pharmacies (including mail order). Although self-medication represents the major part of revenue, OTC products may also be prescribed and reimbursed by health insurance companies.
Market opportunities: biopharmaceuticals
The development of biological drugs has led to substantial shifts in the pharmaceutical industry landscape in recent years. Large companies have moved their focus from small molecule drugs towards the development and production of complex biological compounds that are made with the help of a variety of organisms.
Because of their high therapeutic potential, biologics have taken up a considerable share of the pharmaceutical market in Germany: From 2015 to 2020, the biologics market grew by 12.2 percent on average annually – more than twice the growth of the overall pharma market. The total revenue of biopharmaceuticals in Germany is EUR 14.6 billion (2020), equivalent to more than a quarter of the market for pharmaceuticals.
Market opportunities: Pharma production location Germany
Germany is one of the world’s top pharmaceutical production locations. In 2020, pharmaceutical production volume reached EUR 32.4 billion – equivalent to 3.9 percent year-on-year growth.
Together with France and Italy, Germany belongs to the biggest pharmaceutical manufacturing locations within the European Union.
44 different biopharmaceuticals that are approved in the EU are produced in Germany – this is the second highest figure worldwide after the USA. Three important factors contributing to this excellent position are the high-performing industrial infrastructure, the long-standing strength of the local chemical industry, and a highly qualified workforce.
Research and development
Germany provides the perfect environment for the development and production of research-intensive, high-grade products.
In 2020, the pharmaceutical industry in Germany invested almost EUR 7.7 billion in R&D – more than in any other European country. The German pharmaceutical sector shows the highest research intensity across all major German industries – about 14.4 percent of revenues were reinvested in R&D in 2020.
With 542 clinical trials financed by research-based pharmaceutical companies in 2020, Germany ranks fourth worldwide. Based on the number of patent applications, the country is leading in pharmaceutical innovation in Europe. In 2020, some 631 patents were registered with the European Patent Office by the pharmaceutical industry in Germany.
Over 30 biotechnology clusters bundle scientific expertise at a regional level and connect academic and industrial players in the field of drug development, thereby contributing substantially to the advancement of pharmaceutical innovation and creating an innovation ecosystem that enjoys global acclaim.
Germany's food supplements market is a billion-dollar industry, with one in three Germans regularly taking food supplements to improve their health and well-being.
"The availability of a highly trained labor force, a secure legal framework, the company’s own long tradition in Germany, and a proven record in biopharmaceutical production were determining factors for the site expansion."
Industry Associations
The pharmaceutical industry is represented by several associations:
German Association of Research-based Pharmaceutical Companies (vfa): The vfa represents the interests of 44 global leaders in research-based pharmaceutical companies and more than 100 subsidiaries and affiliated companies in healthcare, research, and economic policy.
German Association for the Pharmaceutical Industry (BPI): The BPI represents approx. 240 companies. This includes traditional pharmaceutical companies, pharmaceutical service providers, and companies in the fields of biotechnology, herbal medicine and homeopathy/anthroposophy.
German Association of Pharmaceutical Producers (BAH): With more than 450 members, the BAH has the most members among the pharmaceutical industry associations in Germany. Its members are primarily pharmaceutical producers, but also pharmacists, lawyers, publishers, agencies, as well as market and opinion research institutes in the healthcare field.
Pro Generika: Pro Generika is the association of companies that manufacture generic and biosimilar products in Germany. Pro Generika has 16 member companies in Germany. Companies manufacturing generic and biosimilar products together cover over 75 percent of the medicinal drugs required by the statutory health insurance funds.
Germany is one of the world’s most important providers of healthcare products and services. Gain access to the German healthcare market and identify potential German partners with HEALTH MADE IN GERMANY, our export inititaitve for the German healthcare industry.
German manufacturers and service providers in all healthcare and life sciences segments attract overseas customers. The German market, one of the leading helathcare markets in the world, boasts many opportunities for international companies looking for partners on the German market.
Our online company directory gives you free access to more than 3,500 profiles of companies active in the German healthcare market. We cover all the main healthcare industry sectors, ranging from medical biotechnology, pharmaceuticals, medical technology to digital health and related sub-sectors.
Individual company profiles provide you with detailed information about each company’s activities, product and services range, financial data and contact information. This allows you to establish direct contact with potential partners in Germany.
How HEALTH MADE IN GERMANY can support your company
We provide proactive support in navigating the German healthcare market. Our services cover four major industries active in the international medical market: pharmaceuticals, medical technology, medical biotechnology, and digital health care. We work in close cooperation with 16 major German industry associations and are ideally placed to provide access to German healthcare market information and to help overseas businesses identify potential German partners.
We take part in leading healthcare trade fairs all over the world, organize networking events and enjoy ongoing dialogue and exchange with international health policymakers.
Contact us for more information on how to get into contact with potential partners and suppliers in Germany.
HEALTH MADE IN GERMANY is the export initiative for the German healthcare industry. We support international companies and organizations that are interested in establishing contact with potential German partners and suppliers. Set up by the German Federal Ministry for Economic Affairs and Climate Action (BMWK), the initiative bundles expert market intelligence for easy industry access. One of the initiative’s main goals is to promote the German healthcare sector through international networking activities for the mutual benefit of international partners and German companies alike.
The HEALTH MADE IN GERMANY initiative is implemented by Germany Trade & Invest.
Latest publications
HEALTH MADE IN GERMANY provides extensive information about the German healthcare industry, its different sectors and individual companies active there. Download our latest industry profiles for free to access the German healthcare industry and establish contact with potential German partners and suppliers.
Gain access to the German healthcare market and identify potential German partners with HEALTH MADE IN GERMANY, our export inititaitve for the German healthcare industry.
