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Published on 21 May 2009

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Generic drugs prompt market rethink

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The scramble for revenues from generic drugs has changed up a gear with the purchase of Austria’s EBEWE Pharma by Swiss pharmaceuticals giant Novartis.

EBEWE’s products, including versions of the chemotherapy agents Cytarabine and Etoposid and breast-cancer treatment Tamoxifen, will be incorporated into Novartis’s own generics unit, Sandoz.

The £760 million buyout reflects the fact that the market for injectable generic drugs, particularly cancer treatments, is estimated to have been worth between £6 billion and £8 billion last year.

Novartis reports that cancer drugs worth £5.7 billion in annual sales are expected to lose patent protection by 2015, which will affect revenues and profits across the industry.

This latest move follows Pfizer’s decision to expand more strongly into generic drugs by establishing a partnership with injected-drugs specialist Claris Lifesciences while expanding a prior deal with India-based Aurobindo Pharma.

Pricing pressures, increased competition and a lack of new blockbuster drugs in the pipeline are encouraging more major pharmaceutical companies to expand into the generics market.

For many, their biggest moneymakers are rapidly losing patent protection, which makes them vulnerable to generic competition.

Copyright Press Association 2009

Novartis



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