【Aging, safety net and fiscal crisis in Japan】No.151: The trade deficit of the medical industry was USD 27 billion in 2016

In this column series, Yukihiro Matsuyama, Research Director at CIGS introduces the latest information about aging, safety net and fiscal crisis in Japan with data of international comparison.

In December 2018, the Ministry of Internal Affairs and Communications released the statistics of the pharmaceuticals patent trade balance of 2016. By adding the trade balance statistics of pharmaceuticals and medical devices to these data, the trade balance of the medical industry can be calculated as a whole. As shown in Table 1, the trade deficit in the medical industry rapidly increased from 678 billion yen (USD 6.2 billion) in 2002 to 2,960 billion yen (USD 27 billion) in 2016. The patent trade balance of pharmaceuticals is in surplus because pharmaceutical companies have built factories overseas to avoid the high corporate tax rate burden in Japan, and, therefore, patent fees are obtained from these overseas subsidiaries (see Column No. 4).

Table 1: Pharmaceuticals/medical devices trade balance in Japan (billion yen)

Source: Ministry of Finance and Ministry of Health, Labour and Welfare

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