The generic pharmaceutical industry currently has more opportunity than it can handle! Nostrapharmus notes that much of that opportunity will be more concentrated in emerging markets such as India. With $100 billion worth of drugs coming off patent in the next two years, the result will be an increase in the US from 77% of prescriptions in the first half of 2010 to as much as 85% by 2014¹. Indian drug firms, which account for a third of US abbreviated new drug applications (ANDA), could also add $2.5 billion in US sales in the next five years¹.

 

The threats to acquiring this market share, however, are also increasing on a number of fronts. Competition among generic manufacturers is fierce, and lawsuits are common and increasing in volume. Also, regulators, particularly in the US, are much stricter with many generic companies currently facing compliance issues. The rigour of regulators and the fierce competition is reflected by the current time taken for ANDA approvals, which has increased from an average of 25-30 months a year ago to 30 months².

 

The challenge for generic companies is to combine science and business acumen. This is partly forced by the regulations as an important section of the Hatch-Waxman Act, which actually encourages generic companies to challenge patents. If a generic company is the first to file its ANDA with a Paragraph IV certification (a patent challenge) and prevails in the subsequent lawsuit, that generic company is granted a period of market exclusivity of 180 days. Most, if not all, generic companies, in both emerging and mature markets, have made the Paragraph IV certification a routine part of doing business. In an industry where profit margins are tight, six months of exclusivity for a product can increase a generic's cash flow exponentially.

 

​

If you would like to read the article in full, please click on the pdf link below:

 

 

or to view the magazine, follow the link below, the article can be found on page 58