UK Pharmaceutical Sector 2023

Payment Culture in the Pharmaceutical Sector

Small businesses that supply to the Pharmaceutical sector in the UK have been facing a significant challenge in recent years due to late or slow payment. This issue has become more pronounced in 2023 as the economic fallout from the COVID-19 pandemic continues to impact the business landscape.

The problem of late payment is not unique to the Pharmaceutical industry but has been a persistent issue across various sectors in the UK. However, the impact on small businesses supplying this sector can be particularly severe due to the high costs involved in manufacturing and research and development.

One of the major challenges faced by small businesses is the extended payment terms offered by Pharmaceutical companies. The payment terms can be as long as 120 days, which can cause significant cash flow problems for small businesses. In addition, larger pharmaceutical companies may use their market power to negotiate extended payment terms or to delay payment altogether, putting small businesses at a disadvantage.

Looking across this year versus last year, Pharmaceutical is another sector where we see a general trend of the worst getting worse and the best getting better. Slow payers continue to be topped by Mundipharma paying on average at 108 days. But nine out of ten of the slowest payers have extended their payment times further, with Spire Healthcare and Pharm Research Associates getting close to doubling their payment times.

On the positive side, we see seven out of the ten fastest paying companies paying even faster, with two noteworthy mentions, Roche Diagnostics who have halved their payment times from 50 to 25 days, and Gilead Sciences International, who have jumped in the year from the slow to the fast paying companies, going from 70 to 20 days payment.

February 2022 Average Days to PayFebruary 2023 Average Days to Pay
Teva UK7182
Smiths Medical8078
Glaxo Smithkline Export7376
Bestway Pharmacy6975
Spire Healthcare3970
Smithkline Beecham 6267
Pharm Research Associates3967
Pfizer R&D6365
Boots 2728
Eli Lilly & Co2627
Roche Diagnostics5025
Boehringer Ingelheim2424
Novo Nordisk2723
Gilead Sciences International7020
CSL Behring2318
Iqvia Biotech1816
Motability Operations55

How long do your customers take to pay?