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Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis
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Global Generic Pharmaceutical Market - Qualitative and Quantitative Analysis

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This report was presented at the Pharma Tech 2013 Conference - India A Game Changer in the Pharma Industry at Ahmedabad, India in December 2013. The presentation highlights the overview of the global …

This report was presented at the Pharma Tech 2013 Conference - India A Game Changer in the Pharma Industry at Ahmedabad, India in December 2013. The presentation highlights the overview of the global generic pharmaceuticals market, with particular focus on the key market trends and challenges by therapeutic areas and geographies including the U.S, EU and India. List of key blockbuster drugs scheduled to lose patent protection between 2010 and 2020 have been included. Additionally impact of regulation on generic drugs by region and strategic recommendations for the success of market participants are also covered in this report.

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  • 1. Global Generic Pharmaceutical Market – Qualitative and Quantitative Analysis Aiswariya Chidambaram Senior Research Analyst - Life Sciences Pharma Tech, Ahmedabad 12-11-2013
  • 2. Focus Points Generics Lead the Way Ahead Global Generic Pharmaceutical Market – Patent Cliff Key Therapeutic Areas Overview Key Therapeutic Areas Growth Analysis Key Market Drivers and Challenges Mergers & Acquisitions Outlook Focus Points Competitive Landscape Analysis U.S. Generic Pharmaceutical Market Overview & Regulatory Analysis European Generic Pharmaceutical Market Overview & Regulatory Analysis Indian Generic Pharmaceutical Market Overview & Regulatory Analysis Future Trends and Directions – Vision 2025 Strategic Recommendations 2
  • 3. Generics Lead the Way Ahead The global generic pharmaceutical market worth over $150 billion in 2013, growing at CAGR (2013 – 2018) of 8.4% U.S world’s largest generics market (45%). India and China - huge generic markets in production volume. Over the next five years Emerging markets 15 % to 20% growth. Matured markets – 6% to 10% growth. The top eight global markets comprise 80% of the total generic sales. Blockbuster drugs ($150 billion) to lose patents between 2010 and 2017. The top ten global generic companies account for 47% market share. Source: Frost and Sullivan
  • 4. Global Generic Pharmaceutical Market – Patent Cliff Total Pharmaceutical Market: Sales Value of Drugs Losing Patent Protection (Global), 2007 - 2017  Generic companies have been proactive in filing for marketing rights and exclusivity well ahead of patent expiry. 42.11 45  Ranbaxy was the first filer of ANDA for generic Lipitor in November 2011 while Watson Pharma was to sell authorised generic version in the U.S. Sales ($ Billion) 40 33.43 35 30 25 20 33.18 27.79 24.33 16.95 15.21 15 7.08 10 8.13 7.96 2.96 5 0  Teva was awarded with 180 days exclusivity to sell generic Losartan while Hi Tech Pharmacal successfully challenged J&J’s Levaquin (oral solution). 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Year  The U.S. patent for AstraZeneca’s Crestor was challenged by Apotex, Mylan and Sandoz.
  • 5. Key Therapeutic Areas Overview Generic Pharmaceutical Market: Percent Revenue Contribution by Therapeutic Segments (Global) 16.1% 35.1% 21.7% 0.2% 6.4% 3.4% CNS Cardiovascular Dermatology 8.3% Genitourinary/Hormonal Drugs 4.5% 4.3% Respiratory Rheumatology Diabetes Oncology Others Note: All figures are rounded;. Source: Frost & Sullivan Others include Gastro-intestinal, HIV, Immunology and so on.  Cardiovascular and CNS are the two largest market segments, constituting nearly 38% of the global generic pharmaceutical market together.  However, therapeutic segments such as Respiratory, CNS and Oncology are likely to witness significantly high growth rates, attracting the attention of market participants.  On the contrary, segments such as Diabetes and Genitourinary/ hormonal drugs are expected to decline by the 2017.
  • 6. Key Therapeutic Areas – Growth Analysis 20% 14% The patent expiry of several key antipsychotics and anti-depressants contribute to the rapid growth of CNS drugs market between 2010 and 2017. Development/ Fast Growing 12% C A G R Fast Growing 10% 8% The reason behind such enormous growth is the massive number of patent expiries. Almost half of the global asthma and COPD market drugs are set to lose patent protection by 2016. Development/ Fast Growing Fast Growing Growing Growing One of the promising segments for generic participants to venture between 2010 and 2015 is oncology as drugs worth $10 b are set to lose patent protection by 2015 6% 4% CNS Oncology Bubble size represents market value Rheumatology Declining Declining Stable Intense competition, promotion of branded drugs and new innovative formulations such as inhalable insulin are all likely to deter the growth of generics. 2% Cardiovascular Relatively lesser number of drugs are subjected to generic exposure during the forecast period and hence the decline in growth. Respiratory Diabetes Dermatology Genitourinary Others Source: Frost & Sullivan analysis.
  • 7. Key Market Drivers and Challenges Key Drivers Patent expiry of key blockbuster drugs worth $150 billion. Access to emerging markets and niche therapeutic segments New provisions introduced by governments Price control measures introduced by governments Changing population demographics and lifestyle patterns Intense price competition due to imports from low-cost markets Increasingly stringent regulations to safeguard quality Key Challenges Source: Frost & Sullivan analysis
  • 8. Mergers & Acquisitions Outlook Generic Pharmaceutical Market: Number of Deals and Amount Spent on Mergers & Acquisitions (Global), 2000 - 2009 30.00 90 80 70 20.00 60 50 15.00 40 10.00 30 Number of Deals Total Value of Deals ($ Billion) 25.00 20 5.00 10 0.00 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Year Total Value of Deals Number of Deals Note: All figures are rounded; Source: Frost & Sullivan analysis. The number of deals and the total expenditure on mergers and acquisitions have been increasing steadily over the years since 2000. There was a peak in M&A activity in 2005 and 2008. The trend is likely to continue with all the key generic participants increasing their dependence on strategic alliances to conquer market shares. Source: Thomson Reuters and Frost & Sullivan analysis.
  • 9. Competitive Landscape Analysis Generic Pharmaceutical Market: Ranking of Top Five Companies by Market Share (Global) Rank Company  The top three companies namely Teva, Sandoz and Mylan registered significant growth rates of 16, 14 and 11% respectively in 2010 - 2011. 1  Most of the big companies prefer mergers and acquisitions to organic growth as a faster means to consolidate and expand their market shares. 2 3  The top five generic pharmaceutical companies accounted for 40% of the share in the global generic pharmaceutical market. Mylan 4 5 Source: Frost and Sullivan analysis
  • 10. U.S. Generic Pharmaceutical Market  World’s largest generic pharmaceutical market represents 45% of global share.  More than 500 industry participants – top five companies constitute 50% sales  Highly saturated – highest levels of generic penetration  Most attractive hub for lowcost destinations like India, China – increased pricing pressure  Predominantly unbranded generics (INN prescribing) Market Overview  Characterized by high levels of generic prescribing, strong IP legislations, retailers purchasing on price  Blockbuster drugs worth over $67 billion to lose patent protection  Aggressive patent challenges and Paragraph IV filings  Mergers and acquisitions most sought-after trend in the U.S.
  • 11. Key Blockbuster Drugs Losing Patent Protection – U.S. Pharmaceutical Market: Key Blockbuster Drugs Losing Patent Protection (United States), 2010-2017 2010 2011 2012 2013 2014 2015 2016 Atorvastatin Clopidogrel Candesartan Cilexetil Duloxetine Aripiprazole Epoetin alfa (Procrit/ Eprex) Adalimumab Docetaxel Goserelin Enoxaparin Filgrastim Celecoxib Imatinib mesylate Ezetimibe - Latanoprost Epoetin beta Insulin lispro Darbepoetin alfa Pregfilgrastim Lopinavir with Ritonavir - Levofloxacin Escitalopram Oxalate Interferon beta – 1a (Avonex Esomeprazole Magnesium Rituximab Olmesartan Medoxomil - Interferon beta – 1a Glatiramer Trastuzumab - - Donepezil Fluticasone propionate with Salmeterol Xinofoate Gemcitabine Olanzapine Etanercept (Rebif) acetate 2017 Oseltamivir Source: Frost and Sullivan analysis 11
  • 12. Key Blockbuster Drugs Losing Patent Protection – U.S. (continued) Pharmaceutical Market: Key Blockbuster Drugs Losing Patent Protection (United States), 2010-2017 2010 2011 2012 2013 2014 2015 2016 2017 Losartan Pioglitazone Irbesartan Rabeprazol e Infliximab - - - Pantoprazole Quetiapine Montelukast Risedronate Raloxifene - - - - Peginterferon alfa 2a Simvastatin with Telmisartan - - - - Ezetimibe - - Rosiglitazone TacrolimU.S . Tiotropium - - - - - Rosuvastatin Oxaliplatin - - - - - - Sildenafil - - - - - - - Tolterodine - - - - - - - Valsartan - - - - - Source: Frost and Sullivan analysis 12
  • 13. Regulatory Impact Analysis – U.S. Regulatory Environment in the U.S Generic Pharmaceutical Market Hatch-Waxman Act Gregg-Schumer Act Pricing & Reimbursement • “Generic companies could obtain market authorisation by proving bioequivalence of generics to brands • “Single 30-month stay” granted to branded company for patent infringement suit • Safe Harbour Provision: experimental use of patented drugs permitted by generic companies • Stay to run concurrently with FDA’s consideration of application • 180-day market exclusivity for first-to-file generic applicant • 30-month stay for patents listed in Orange Book • No significant generic entry delay in • Allows generic companies to file counterclaims against innovators • Generic drug price ranges from 90% of brand equivalent with just 1 competitor 5% with 16-20 competitors • Medicare Prescription Drug, Improvement and Modernization Act (MMA) 2003 • Medicare reimburses drugs based on weighted average prices • Competitive practiced bidding is Source: Frost and Sullivan analysis 13
  • 14. Europe Generic Pharmaceutical Market  Mature markets (Germany, the UK) to present sluggish growth between 5 – 6%  Top five countries – Germany, the United Kingdom, France, Italy and Spain represent 50% volume share and 18% value share globally.  Italy and Spain are expected to register higher growth rates between 18 – 20%  As per EGA, generic drugs generate savings of €30 billion.  Eastern Europe to contribute maximum growth Market Overview  Germany and the UK are highly penetrated generic markets  Europe primarily dominated by branded generics except the UK  Represent 64% and 60% of volume share respectively in Europe.  Calcium antagonists, antiulcerants and platelet inhibitors to face high generic competition  Germany is the largest generic market in Europe accounting for 27% sales  Highly fragmented market with county-specific regulations Source : Frost & Sullivan analysis. M74E-52 14
  • 15. Key Blockbuster Drugs Losing Patent Protection – Europe Pharmaceutical Market: Key Blockbuster Drugs Losing Patent Protection (Europe), 2010-2017 Drug France Germany Italy Spain U.K. Anastrozole 2010 2010 2010 2010 2010 Aripiprazole 2011 2011 2011 2011 2011 Atorvastatin 2011 2011 2011 2011 2011 Candesartan Cilexetil 2012 2012 2012 2012 2012 Celecoxib 2014 2014 2014 2014 2014 Clopidogrel 2013 2013 2013 2013 2013 Darbepoetin alfa 2014 2014 2014 2014 2014 Docetaxil 2010 2010 2010 2010 2010 Donepezil 2012 2012 2012 2012 2012 15
  • 16. Key Blockbuster Drugs Losing Patent Protection – Europe (continued) Drug France Germany Italy Spain U.K. Duloxetine 2012 2012 2012 2012 2012 Escitalopram Oxalate 2014 2014 2014 2014 2014 Esomeprazole Magnesium 2010 2010 2010 2010 2010 Etanercept 2014 2014 2014 2014 2014 Ezetimibe 2017 2017 2014 2017 2017 Fluticasone propionate with Salmeterol xinofoate 2013 2013 2013 2013 Invalidated Glatiramer acetate 2015 2015 2015 2015 2015 Imatinib mesylate 2016 2016 2016 2016 2016 Infliximab 2014 2014 2014 2014 2014 16
  • 17. Key Blockbuster Drugs Losing Patent Protection – Europe (continued) Drug France Germany Italy Spain U.K. Insulin glargine 2014 2014 2014 2014 2014 Insulin lispro 2010 2010 2010 2010 2010 Interferon beta 1a (Rebif) 2013 2013 2013 2013 2013 Irbesartan 2013 2013 2013 2012 2013 Levofloxacin 2011 2011 2011 2012 2011 Lopinavir with Ritonavir 2016 2016 2016 2016 2016 Montelukast 2012 2012 2012 2012 2012 Mycophenolate mofetil 2010 2010 2010 Expired (2007) 2010 Olanzapine 2011 2011 2016 2011 2011 17
  • 18. Key Blockbuster Drugs Losing Patent Protection – Europe (continued) Drug France Germany Italy Spain U.K. Olmesartan medoxomil 2017 2017 2017 2017 2017 Oseltamivir 2017 2016 2017 2017 2016 Oxaliplatin 2013 2013 2013 2013 2013 Pegfilgrastim 2017 2017 2017 2017 2017 Peginterferon alfa-2a 2013 2013 2013 2013 2013 Pioglitazone 2011 2011 2011 2011 2011 Quetiapine N.M 2012 2012 2012 2012 Rabeprazole Expired (2007) 2012 2012 2012 2012 Risedronate 2010 2010 2010 2013 2010 18
  • 19. Key Blockbuster Drugs Losing Patent Protection – Europe (continued) Drug France Germany Italy Spain U.K. Rituximab 2013 2013 2013 2013 2013 Rosiglitazone 2013 2013 2013 2013 2013 Rosuvastatin 2017 Not mentioned 2012 Not mentioned 2017 Sildenafil 2013 2013 2013 2013 2013 Telmisartan 2013 2017 2017 2013 2017 Tiotropium 2016 2015 2014 2015 2012 Tolterodine 2012 2012 2012 2012 2012 Trastuzumab 2012 2012 2012 2012 2012 Valsartan 2011 2011 2011 2011 2011 Zoledronic acid 2012 2012 2012 2012 2012 19
  • 20. Regulatory Impact Analysis - Europe Regulatory Environment in the European Generic Pharmaceutical Market Data Exclusivity • Uniform level of data protection of originator products for 10 years • Permits to access data of a generic application but the generic version cannot be launched until the completion of the ten-year period 8+2+1 Formula European Bolar Clause European Bolar Clause • Originator companies are granted 8-year data exclusivity and 2 years market exclusivity • Permits initiation of generic R&D activity prior to patent expiry of brands • Additional one year exclusivity awarded for new product indications and those shifting from “prescription only” to OTC • Generics can enter the market only after the 10th or 11th year • Withdrawal of brands before generic entry cannot stop generic companies from using them as reference products Sunset Clause • Allows cancellation of marketing authorization for products not in market for 3 years • Legal challenges by patent owners can prevent generic companies from applying registrations more than 3 – 4 years in advance of patent expiry Source: Frost & Sullivan analysis. 20
  • 21. Regulatory Policies of Key Generic Markets in Europe Comparative Analysis Generic Pharmaceutical Market: Impact of Regulatory Policies (Europe) Policies Germany United Kingdom France Spain Italy Reference pricing Patient co-payment Generic prescribing Generic substitution Time delay in market access High Low Source: Frost & Sullivan analysis. 21
  • 22. Indian Generic Pharmaceutical Market  Branded generics dominate the Indian pharma market (98%) valued at over $12.00 billion  Highly fragmented market with more than 22,000 registered units  World leader in exporting generics to foreign countries; exports growing at 22%  Companies such as Sun, Lupin, Aurobindo, Dr.Reddy’s Laboratories, Cipla and Ranbaxy have been aggressive in DMF and ANDA filings with an granted approval rates of 35%  Anti-infectives and GI constitute 30% revenue share Market Overview  India produces 20 – 22% of world’s generic drugs including nearly 60,000 generic brands covering 60 key therapeutic areas  Ranks third in API manufacturing accounting for 6.5% of world API production  Top ten players account for 37% market share in India Consolidation in the form of strategic alliances between Indian and foreign companies is on the rise  Extremely promising future for generics in India Source: Frost and Sullivan analysis
  • 23. Export of Indian Generics to the U.S. Total Pharmaceutical Market: Breakdown by Domestic Sales and Export Sales (India)  Steep rise in export of Indian generics to the U.S. over the last five years  Currently generic drugs from India represent 18% of generic drugs in the U.S. Export 52 % Domestic  India has more than 75 U.S. FDA approved plants and tops the world in DMF and ANDA filings in the U.S. 48 %  Indian generic firms directly compete with multinational generic companies leading to Intensified price competition in the U.S.  It is estimated that India is likely to capture at least 30% of replacement generic equivalents in the U.S. by 2018 Source: Frost and Sullivan analysis
  • 24. Regulatory Impact Analysis - India Pharmaceutical Policy Drug Policy 1996 Pharmaceutical Policy 2002 National Pharmaceuticas Policy 2006 Quality Control Price Control On Prices GMP/cGMP Drug and Cosmetic Act 1940 Schedule M Schedule Y On Margin Bulk Drugs Formulations IPR Protection Essential Commodities Act 1955 Drug (Price Control) Order 1995 Amended Patents Patents Amendment Act 2005 Source: Frost and Sullivan analysis
  • 25. Regulatory Impact Analysis – India (continued) Regulatory Environment in the Indian Generic Pharmaceutical Market Pricing & Reimbursement • The revised policy of the National Pharmaceutical Policy Authority, has capped margins on generic drugs at 15% for wholesalers and 35% for retailers • Price controlled drugs Category I: Essential drugs Category II: All drugs not in Category I • Drugs exempted from price control required to meet specific criteria Patent Protection/ IP Rights Quality Control • Patents Amendment Act 2005 (TRIPS Agreement) strictly prohibited reverse engineering of drugs • The Drug and Cosmetics Act (D&C) 1940 regulates import, manufacture, distribution and sales • Covers two types of generic drugs – off patent generics and generics of drugs patented before 1995 • Schedule M – requirements for factory premises, plant, materials, plant and equipment • Introduced compulsory licensing for exports • Schedule Y – legislative requirements for clinical trials • Mainly encourages foreign companies to trade in India • Increasing regulatory compliance in India boosts confidence of MNCs Source: Frost and Sullivan analysis 25
  • 26. Future Trends and Directions – Vision 2025 Balance in terms of healthcare expenditure and sales revenue is likely to shift from developed markets to emerging markets. Consolidation is expected to remain the key factor for growth and sustenance of generic companies. Large generic companies are likely to increase their investments in R&D activities Key Trends Technology Development of Transgenic technologies Stem cell technologies Cloning technologies Generic consumption is likely to be favoured in a big way by the government, payers, policy-makers and physicians. Increasing focus on higher value biological therapies, biosimilars, controlled release products, sterile formulations and niche therapeutic segments. Source: Frost and Sullivan analysis
  • 27. Strategic Recommendations for Success Strategy is a style of thinking, a conscious and deliberate process, an intensive implementation system, the science of insuring future success – Pete Johnson Differentiated Approach Explore New Avenues Big multinational generic firms require to focus on  Products with technologically challenging formulations.  Products which require significant regulatory support.  Products with limited availability of APIs.  Analyze prospects for market globalization - Strategic alliances between multinational generic firms and domestic participants with locally restricted operations. Medium-sized generic firms require to focus on  Products with relatively higher profit margins.  Appropriate time of entry into the right market.  Strengthen distribution. Instill Competitive Capabilities  Invest in R&D.  Improve product line.  Defend company’s position in the market.  Strike a balance between supply and demand side.  Pioneer new and better technologies. Plan Ahead for the Future  Research customer needs, preferences, expectations.  Monitor new technological developments to face the change.  Target therapeutic areas with high levels of unmet clinical needs. Source: Frost and Sullivan analysis
  • 28. Related Market Research Reports  Global Pharmaceutical Contract Manufacturing Market  Global Next Generation Biosimilars Market  Global Contract Research Outsourcing Market 28
  • 29. Questions
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  • 31. Contact Information State your need, we would be happy to serve you… AISWARIYA CHIDAMBARAM Senior Research Analyst – Life Sciences Frost & Sullivan (I) Pvt. Ltd. ASV HANSA No.53, Greams Road Thousand Lights Chennai 600 006 www.frost.com Tel: +91 (0) 44 61606666 (Extn: 4097) Fax: +91 (0) 44 4230 0369 Email: AiswariyaC@frost.com Your Growth Partner 31

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