Global Generics
Cygnus Research, August 2011, Pages: 153
Global Generics market was valued at US$123 billion in 2010, and has been estimated to reach US$ 180 billion by 2014, at a CAGR of 10.6% during 2011-14.
Generics market remains a major growth area in the global healthcare market, with market growth significantly higher than that of patented drugs and the overall pharmaceutical market. The industry has witnessed a decade long sales euphoria as volume and value sales of generic drugs continue to increase.
Several big players have been moving into the generic drugs market - spearheaded by leading pharma companies and specialist pharma organisations. The top 10 players together accounts for more then 40% of the global generics market. Teva was the leading generics company in the year 2010 with annual revenue of US$16.1 billion. The global generics industry is undergoing a phase of consolidation. Global pharma players continue to penetrate the burgeoning emerging markets by acquisition of domestic generics and manufacturing companies.
SCOPE OF THE REPORT
This report discusses in detail about the major generic markets while giving information on their market size, recent trends, major players, generics pricing and outlook for the market. The report also analyses the factors that drive the growth of the generics industry.
- Overview of the generics industry in terms of size, geographical and Therapeutic segmentation
- Top 20 products in world's largest generics market
- Industry Trends
- Growth Drivers , Issues & Challenges and Critical success factors
- Mergers & Acquisitions
- Major Markets ( North America, Europe and Asia Pacific)
- Major Players - their business and financial profile, key strategies, R&D pipeline and outlook for the company.
- Amount & Area of R&D spend of major generic companies
- Regulations governing generics, Key patent expiries in the future
- Outlook for the global generics industry for the next five years
REASONS TO BUY
- First of its kind report on Global generics market
- To know the recent developments in the industry in terms of regulations. Patents etc
- To understand the recent strategies being adopted by major players.
FOR WHOM
- Life sciences companies (Bulk drugs, Formulations and Bio-pharma)
- Govt departments & Agencies working in Pharma
- Consultants
- Associations & Consortia of the industry
- Research Institutions
- Education Institutes (Pharma Colleges and Management Colleges)
1. EXECUTIVE SUMMARY
2. HIGHLIGHTS
3. MARKET OVERVIEW
3.1 Global generics market
3.2 Geographical segmentation
3.3 Ethical Vs. OTC generics
3.4 Major generic companies
3.5 Top 20 products in the US
4. INDUSTRY TREND
4.1 Mergers and Acquisitions
4.2 Patent challenges
4.3 Regulatory changes
4.4 Distribution Models
4.5 Centralised contracting and increasing role of payers
4.6 Costs & pricing trends
5. MAJOR MARKETS
5.1 North America
5.1.1 The US
5.1.2 Canada
5.2 Europe
5.2.1 Germany
5.2.2 The UK
5.2.4 Spain
5.2.5 Italy
5.3 Asia Pacific
5.3.1 Japan
5.3.2 China
5.3.3 India
6. GROWTH DRIVERS
6.1 Cost advantage
6.2 Increasing patent expiries
6.3 Accelerated shift in spending on generics
6.4 Rising healthcare expenditure
6.5 Greater M&A activities
6.6 Shifting disease pattern
6.7 Changing age structure of the global population
7. ISSUES AND CHALLENGES
7.1 Authorized generics
7.2 Patent extension strategies
7.3 Price erosion leads to intense competition
7.4 Litigation and legal aspects
7.5 Competition from low cost manufacturers
7.6 More branded companies in generic competition
8. RESEARCH AND DEVELOPMENT
8.1 R&D spending by major generic companies
8.2 Areas of R&D spend
9. REGULATIONS
9.1 Significant policy changes in 2010 (Worldwide)
9.2 Regulatory aspects in the US
9.3 Regulatory aspects in Europe
9.4 Regulatory aspects in Japan
9.5 International agreements on IPR protection
9.5.1 General Agreement on Tariffs and Trade, (GATT)
9.5.2 Trade Related Aspects of Intellectual Property Rights (TRIPS)
9.5.3 The Paris Convention for the Protection of Industrial Property (PCPIP)
9.5.4 The Patent Co-operation Treaty (PCT)
10. MAJOR PLAYERS
10.1 Teva Pharmaceutical Industries Ltd
10.1.1 Business Profile
10.1.2 Financial Profile
10.1.3 Key Strategies
10.1.4 Outlook
10.2 Mallinckrodt
10.2.1 Business profile
10.2.2 Financial Profile
10.2.3 Outlook
10.3 Sandoz
10.3.1 Business profile
10.3.2 Financial Profile
10.3.3 Key Strategy
10.3.4 Outlook
10.4 Mylan Inc
10.4.1 Business profile
10.4.2 Financial Profile
10.4.3 Key Strategy
10.4.4 Outlook
10.5 Hospira, Inc
10.5.1 Business profile
10.5.2 Financial Profile
10.5.3 Acquisitions
10.5.4 Financial Goal
10.5.5 Outlook
10.6 Watson Pharmaceuticals
10.6.1 Business profile
10.6.2 Financial Profile
10.6.3 Key Strategy
10.6.4 Outlook
10.7 STADA
10.7.1 Business profile
10.7.2 Financial Profile
10.7.3 Key Strategy
10.7.4 Outlook
10.8 Cipla Ltd
10.8.1 Business profile
10.8.2 Financial Profile
10.8.3 Key Strategy
10.8.4 Outlook
10.9 Par Pharma
10.9.1 Business profile
10.9.2 Financial Profile
10.9.3 Strategy
10.10 Dr. Reddy's Laboratories Ltd
10.10.1 Business profile
10.10.2 Financial Profile
10.10.3 Key Strategy
10.10.4 Outlook
11. CRITICAL SUCCESS FACTORS
11.1 Biogenerics
11.2 Outsourcing
11.3 Venturing into “difficult to make” generics
11.4 Mergers and Acquisitions
11.5 Investments in R&D
11.6 Identifying the right patents to challenge
11.7 Striking alliances
12. KEY PATENT EXPIRIES (2010-15)
13. OUTLOOK
ANNEXURE – I
ANNEXURE II
ANNEXURE III
ANNEXURE IV
ANNEXURE V
LIST OF FIGURES
Figure 3.1: Global generics market (2007-11)
Figure 3.2: Geographical representation of global generics market-2010
Figure 3.3: Ethical vs. OTC generics-2010
Figure 3.4: Top Global Generic players by Annual Sales- 2010
Figure 4.1: M&A in global generics market (2006-09)
Figure 4.2: Global DMF Filing trends by DMF Types (2008-2011)
Figure 5.1: US generics market (2006-10)
Figure 5.2: Growth of Generic prescriptions (2006-10)
Figure 5.3: Canada generics market (2006-10)
Figure 5.4: Average Retail Price per Prescription in Canada (2006-10)
Figure 5.5: Germany generics market (2006-10)
Figure 5.6: UK generics market (2006-10)
Figure 5.7: France generics market (2006-10)
Figure 5.8: Spain generics market (2006-10)
Figure 5.9: Italy generics market (2006-10)
Figure 5.10: Japan generics market (2006-10)
Figure 5.11: China generics market (2006-10)
Figure 5.12: India generics market (2006-10)
Figure 5.13: Global DMF Filing trends by DMF Types
Figure 5.14: % Share of top 10 DMF Filers at USFDA
Figure 6.1: Patent expiries by value (2008-12)
Figure 6.2: Global Expenditure by Segment
Figure 6.3: Rise in Generic Share (Developed Markets)
Figure 6.4: Healthcare expenditure as a % of GDP (2005-09)
Figure 6.5: Global DALYs by disease (2000-30)
Figure 6.5: Percentage of population aged 55 & above as a percentage to the total population (2008-2025)
Figure 7.1: Authorized generic launches (2005 to 2009)
Figure 7.2: Generics pricing - The market scenario
Figure 8.1: Top generic players by R&D spending (2010)
Figure 8.2: Areas of R&D spend by generic firms
Figure 9.1: Generic drug approval procedure in the US
Figure 11.1: R&D expenditure as a percentage of sales – 2010
Figure 13.1: Global generics market (2010-14)
LIST OF TABLES
Table 3.1: Top 20 products by prescription (2010)
Table 4.1: Key M&A in global generics industry – 2010
Table 5.1: Major Countries in DMF Filing in 2010*
Table 5.2: Major Countries in DMF Filing in 2009
Table 5.3: Major Countries in DMF Filing in 2008
Table 6.1: Cost Comparison of 25 Branded Drugs and their Generic Counterparts
Table 6.2: Major Drug Patent Expiries (2009-12)
Table 6.3: Major Protection Expiries by Country (2011-13)
Table 7.1 List of authorized generics launched in the past
Table 7.2: Companies extending patent exclusivity
Table 7.3 Generic Drug Sales Value after Patent Expiration (2010-16)
Table 11.1: Patent expiration of biological products in US Market
Table 12.1: Drug Patent Expiries-2010
Table 12.2: Drug Patent Expiries-2011
Table 12.3: Drug Patent Expiries-2012
Table 12.4: Drug Patent Expiries-2013
Table 12.5: Drug Patent Expiries-2014
Table 12.6: Drug Patent Expiries-2015
In spite of the economic downturn severely affecting industries around the world, the generic drugs industry has managed to stay afloat so far. Major generic drug firms are ploughing forward, intent on riding the growth curve. Generic drugs are increasingly attracting the attention of governments of various countries, patients and the industry due to lower costs and lower R&D investment required, compared with patented drugs.
The global generics market was valued at US$123 billion during 2010, registering a growth of 7.9% over the previous year. The market would further grow by 8.1% to reach US$133 billion in the year 2011. The higher growth rate is attributed to the increasing number of patent expiries and government measures to popularize the use of generics in their countries. Developed countries like the US and UK are also advocating use of generic drugs to contain overall healthcare costs. Cardiovascular (CVS) and Central Nervous System (CNS) were the top two therapeutic segments, accounting for one-third of the total generics market.
Mergers and Acquisitions (M&A) deals made by generic companies valued US$6.8 billion in the year 2009, Mergers and Acquisitions (M&A) activity for generics was at its zenith in the year 2008. The major deal completed in the year 2010 was Teva’s acquisition of Ratiopharm International for US$4.93 billion.
In 2010, a total 116 DMF Filing Type IV was made by the generic companies compared with 114 DMF Filing Type IV filings made in 2009. The cost of filing DMFs and ANDAs is at least 50-60% lower for Indian companies compared with their US or European counterparts Moreover, the regulations governing generics industry has witnessed certain amendments. For instance, the Japanese government issued a notice to companies to provide additional data in the package insert of generic drugs in March 2006.
North America was the major generics market, accounting more than 32.0% of the global market. The US market alone accounted for around 28.0% of the total generics market, growing at a rate of 9.5% in 2010 over the previous year. In Europe, Germany was the largest generics market, valued at around US$10.7 billion in 2010 and accounted for 8.7% of the total generics market. Spain and France accounted nearly 5.5% of the toal generics market. In Asia Pacific, India and China accounted more than 20.0% of the total generics market.
The inherent cost advantages associated with generic drugs coupled with patent expiry of blockbuster drugs are the prime drivers of the industry. Increasing healthcare expenditure in both developing and developed countries, changing demographic profile and disease pattern and greater M&A activity are the other factors that drive the growth of the industry. Studies also reveal that there will be 75% increase of subsidiary generic companies between 2008 and 2010.
One of the major challenges faced by the industry is authorized generic, which has been eating into the profits of a successful patent challenger during the 180 day market exclusivity period. Brand drug companies use patent strategies such as approval for additional indications, paediatric extensions, next-generation product launches such as combinations and new formulations and patent litigation to postpone the exposure of their blockbuster drugs to generic competition and discourage generic companies from challenging their patents. Steep price erosion is yet another challenge faced by the industry as price of a generic drug drops to as low as 90% of the patented drug after the expiry of the 180 day exclusivity period granted to a successful patent challenger.
To market a generic drug in the US, an Abbreviated New Drug Application (ANDA) has to be filed and approved by the Office of Generic Drugs of Centre for Drug Evaluation and Research (CDER) of Food and Drug Administration (FDA), as per the Hatch Waxman Act enacted in 1984. The act also provided provisions to challenge the patent of a drug. For a generic approval, pre-clinical and clinical study data are not needed. However bio-equivalence to the original brand drug has to be proved. In Europe, generic drugs are approved by the European Medicines Agency (EMEA). In Japan, Pharmaceutical and Medical Devices Agency (PMDA) reviews the generic drug application and the final approval is given by the Ministry of Health, Labour and Welfare (MHLW).
Israel-based Teva Pharmaceuticals is the world’s largest generic drug company with revenue of ore thsn US$16.1 billion in 2010. Teva acquired Ratiopharm International for over US$4.9 billion. The second largest generics company is Mallinckrodt, which generated revenue of around US$10.4 billion in the year. Sandoz was the third largest companies with sales of US$8.5 billion. Dr Reddy’s, India’s largest pharmaceutical company, is also among the top leading generic companies with revenues of nearly US$1.0 billion in 2010.
By venturing into biogenerics, generic companies can reap huge profits in future as a number of patented biopharmaceutical products are expiring in the next three years. This segment ensures better margins, as its complexity will limit the number of entrants. The first biogeneric human growth hormone Omnitrope from Sandoz was approved by FDA in May 2006. In 2006, European Union has put together the process for approval for biogenerics. The biogeneric drug approved in the EU was Swiss based Biopartners Valtropin, a biogeneric version of Humatrope. Even countries like India are turning towards biogenerics as large numbers of biologicals are going to be off patent. According to Frost & Sullivan estimates, the biogenerics markets in Europe and the US alone has the potential to generate sales of US$16.4 billion by 2011 at an average annual growth rate of 69.8%.
Cygnus estimates that the global generics market registered a growth rate of 12.50% to reach US$180 billion in 2014 and will a CAGR of 10% during the period, 2010-14. Patent expiries of blockbuster drugs and increasing healthcare expenditure will continue to drive the growth of the industry. The major generic firms will become more dominant with further acquisitions in future. Factors that will determine the success of generics companies include reduction in R&D costs, outsourcing manufacturing activity to low-cost destinations, venturing into “difficult-to-make-generics”, Novel Drug Delivery System (NDDS) and identifying the right patents to challenge. Meanwhile, the pipeline for generic drugs is healthy, and is expected to grow further under intensified global pressure for cheaper and more accessible medicines.
- Teva Pharmaceutical Industries Ltd
- Mallinckrodt
- Sandoz
- Mylan Inc
- Hospira, Inc
- Watson Pharmaceuticals
- STADA
- Cipla Ltd
- Par Pharma
- Dr. Reddy's Laboratories Ltd
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