Pharma cos eyeing US generic drugs space
At a time when the US generic drugs market is reeling under price competition, a recent move by the US government to accelerate approvals of generic drugs in certain high margin categories has opened up greener pastures for Indian generic companie...
By Writankar Mukherjee, TNN |
KOLKATA: At a time when the US generic drugs market is reeling under price competition, a recent move by the US government to accelerate approvals of generic drugs in certain high margin categories has opened up greener pastures for Indian generic companies, including Ranbaxy, Dr Reddy’s, Zydus Cadila and Sun Pharma.
A report on Critical Path Opportunities for Generic Drugs released by the US FDA on Wednesday identified the category of drugs for which the US wants to create a big market — asthma inhaler, nasal spray, gastro-intestinal acting products, cancer (liposome products) and topical skin products like anti-fungal creams.
It also says that US is ready for research collaborations with flagship organisations, including the US FDA laboratories and National Institutes of Health (NIH). Indian pharma companies have lapped up the opportunity and are exploring options for possible partnerships and marketing this category of generic drugs in the US.
Their reason: margins are more than double for these drugs and research partnership with US organisations will provide a global ‘quality’ stamp to their products. “Such partnership with US research organisations will allow easier approval in other global markets since the US FDA is considered the ultimate standard in the global drug industry. Moreover, margins for these drug categories are nearly 10-12% compared to other products at 4-5%,” said Mankind Pharma MD RC Juneja.
The US FDA report points out that there are few generic versions available for these drugs which results in less competition and higher prices. It also notes while “test of blood plasma level is sufficient to demonstrate bio-equivalence for most generic drugs, such common test are generally not appropriate” for these drugs. Bio-equivalence means the generic drug must be absorbed at same rate and same amount as the innovator drug.
ADVERTISEMENT
“This new initiative will clearly benefit the generic industry since this class of drugs is quite difficult to register in the US. We are in the process of studying the new guidelines to see how best to use it to reduce complexities for launching these drugs,” Sun Pharma CMD Dilip Shanghvi told ET. Ranbaxy, too, is keen to explore opportunities for a possible alliance with the US-based research organisations. A Ranbaxy spokesperson said, “It is Ranbaxy’s constant endeavour to explore alliances with government bodies, institutions and innovator companies. Our belief in having a collaborative arrangement stems from the fact that it will enable us to explore and develop innovative medicines at affordable costs.”
Analysts feel Indian firms have an advantage over global competitors to forge research partnerships for these drugs due to availability of a large pool of scientific talent and low cost of production.
“However, Indian firms may face tough competition from Teva and Mylan Labs who will be eager to enjoy the first-mover advantage as well,” said a senior industry official. The US FDA report lays down the bio-equivalence methods for these drugs and possible research organisations for tie-ups.
Start a SIP with as low as ₹500 with ET Money App!
Download
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
ADVERTISEMENT
