Authorized Generics: Look Before you Leap - Market Research Reports - Research and Markets

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Authorized Generics: Look Before you Leap

Description:

Introduction
When faced with a paragraph IV challenge, research-based pharmaceutical companies sometimes use “authorized generics” as a way to slow market share losses. When making these decisions, firms should consider the rate of generic erosion over the 180-day exclusivity period, payer dynamics related to the adoption of generic products during this period, and the terms of any deals forged with generics company partners.

Get the Answers You Need to Shape Your Strategy
The 1984 Hatch-Waxman amendments to the Food, Drug, and Cosmetic Act encourage early generic entry by providing an incentive of a 180-day exclusivity period for generics companies that successfully challenge brand-name drug patents. How successful has this strategy been for generics companies, and how have brand-name pharmaceutical companies responded to this challenge?

The rate of generic erosion of a brand during the 180-day exclusivity period depends on the dynamics of the generic market. What are three key scenarios that illustrate generic erosion during the 180-day exclusivity period?
When an exclusive generic is priced lower than the brand by only a small amount, managed care organizations save little. Factor in the loss of rebates provided by the brand and the lower copay, and exclusive generics can actually increase payers’ expenditures. However, some payers have begun to consider such factors when making reimbursement decisions. How can payer behavior influence the rate at which erosion of brand sales occurs during the 180-day exclusivity period?

When deciding whether to issue an authorized generic, pharmaceutical companies should consider three possible scenarios. What are those scenarios, and how would each affect the research pharmaceutical company’s sales?

Scope
Pharmaceutical companies’ response to paragraph IV challenges: authorized generics.
Authorized generics: the two sides of the debate. Generic erosion: the key factors that affect it.

Contents:

Executive Summary

Strategic Considerations

Stakeholder Implications

Paragraph IV Challenges: An Overview

The Current Landscape for Authorized Generics

Strategies for Dealing with Exclusive Generics

Consolidation and Integration of Brand and Generic Activities

Discounting and Price Negotiations

Generic Erosion

Historic Patterns: Multiple Generics Enter the Market Upon Patent Expiry

Generic Erosion with 180-Day Exclusivity: One Brand, One Generic

The Payer Perspective: Can a Generic That Is Priced Lower Result in Less Savings?

Generalizable Rates of Erosion for Brands

Implications for Authorized Generics

Generic Erosion and the Authorized Generic Strategy

Sidebar: How Can an Exclusive Generic Cost More than a Brand-Name Drug?

The Three Competitive Scenarios: Example 1

The Three Competitive Scenarios: Example 2

A Recent Example of an Authorized Generic Strategy

Authorized Generics: Not the Only Option

Tables
1. Select Brand Companies and Their Generic Subsidiaries
2. Key Payer Segments
3. Brand-Name Drug’s Share of the Market Under Two Scenarios Sidebar Table. Drug Pricing Chain
4. Generic Erosion: Three Competitive Scenarios
5. Generic Erosion in Three Basic Competitive Scenarios: Another Example

Figures
1. Historic Generic Erosion Rates of Drugs Facing Multiple Generic Competition
2. Generic Erosion Rates of Drugs Facing a Single Generic Competitor During the First 180 Days of Generic Entry
3. General Projected Brand Erosion to Generics During the First 180 Days of Generic Entry

Companies Mentioned

- Barr - Bayer - Boehringer Ingelheim - Bristol-Myers Squibb - Eon Labs - Federal Trade Commission (FTC) - Forest - Generic Pharmaceutical Association - Geneva - GlaxoSmithKline - Greenstone - Hexal - Inwood - Johnson & Johnson - Kremers Urban - Merck - Novartis - Office of Generic Drugs - Organon - Par Pharmaceutical - Pfizer - Roche - Roxane - Sandoz - Sanofi -Aventis - Schering-Plough - Schwarz Pharma AG - Teva - Warrick

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