Generic Drugs: The Global Market

Report Highlights

• The global market for generic drugs was worth $81 billion in 2008, a figure that is expected to reach $84 billion in 2009. In 2014, the market is expected to amount to $168.7 billion, for a compound annual growth rate (CAGR) of 15% in the 5-year period.
• Sales of U.S. generic drugs currently dominate the market, estimated at $33 billion in 2009 and projected to increase at a CAGR of 10.4% to $54 billion in 2014.
• Japan’s generic drugs market is expected to have the highest rate of growth among major markets at 12.2%, increasing from $5.4 billion in 2009 to $9.6 billion in 2014.

INTRODUCTION

STUDY GOALS AND OBJECTIVES

• The demand for generics is increasing steadily because of pressure to control healthcare costs. At the same time fierce price competition in this area has put some companies in difficulties because of slashed profit margins. The main result has been a wave of M&A activity, and the rise of “supergenerics” offering added value as well as low prices. Not all traditional companies are placed to exploit this trend. 
• A major growth driver for the generics sector is the fact that several blockbuster pharmaceutical brands are coming off-patent and are therefore open to generic competition. But the “originator” companies are deploying formidable strategies to protect their franchise, including marketing their own branded generics. 
• With first-generation biopharmaceutical products reaching the end of their patent lives, a whole new market field—biogenerics, or biosimilars—is opening up, for those generics companies capable of (or prepared to buy-in) the technological expertise required.
• The international landscape is changing for generics as for all pharmaceuticals. China, India, Eastern European countries and Brazil are among rising centers of generic activity.     

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