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Published on 10 September 2007

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Expert warns of generics slowdown

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Profits for generic drug companies will soar in the coming years although there is still a possibility innovation will dry up, a top industry analyst in the USA claims.

Global sales for generic drug firms are increasing at 14% a year, far better than the single-digit annual growth experienced by branded drugmakers.

Doug Long, vice-president at drug research firm IMS Health, told the Generic Pharmaceutical Association’s policy conference: “The wind is behind the backs of the generic pharmaceutical industry.”

But he sounded a warning that a slowdown in medical breakthroughs could hit the generic drug giants.

Mr Long said generic drugs accounted for 63% of all prescriptions in the USA last year, but said any further growth depends on having new drugs to replicate.

But for the moment the industry is safe, as $12bn (£5.9bn) worth of medicines will lose patent protection this year, while $20bn (£9.8bn) will be up for grabs next year.

These will include Merck’s osteoporosis drug Fosamax, and Johnson & Johnson’s schizophrenia treatment Risperdal.

Despite the current outlook, Mr Long said the industry, which is concentrated among a few key players, is also likely to face price competition from companies in developing countries, such as India and China.

Copyright © PA Business 2007
IMS Health



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