BMI View: TheHungarian government'sharsh measuresaimed at reducingits debt haveseverelyaffectedthe domestic market for pharmaceuticalcompanies, which have posted steep declinesin domestic sales.Prime MinisterViktor Orban's government has backtracked on several controversial measures on tax and company legislation recently, as businesses have implicitly signalled their willingness to leave the country. This latest move will undoubtedly boost the country's attractiveness for R&D and improve the export competitiveness of domestic industry. However, the domestic pharmaceutical market will continue to be impaired by state measures to limit pharmaceutical expenditure, and we continue to expect a second year of value contraction in 2013.

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