2015 Generics Industry Trends
Over the past decade, generics companies have saved the US healthcareĀ system over $1 trillion. Globally, generics companies continueĀ to reduce the cost of medicines while also increasing access to lifesavingĀ medications. This year will be transformational for the generics industry.
BIOSIMILARS
Since creating guidelines in 2005, biosimilar approval by the EuropeanĀ Medicines Agency has saved EuropeĀ $2.2 billion in healthcare costs perĀ year.2 Using the US biosimilar pathway,Ā Sandoz hopes to achieve the first
US FDA biosimilar approval in 2015.Ā By now most generics companiesĀ have determined their strategy forĀ the biosimilar market. As we outlinedĀ in our 2010 Market Adoption Survey,3Ā generics companies should define
their strategy in terms of products,Ā partnership, investment, and regulatoryĀ analysis. As generics companiesĀ struggle to find scientific and technicalĀ expertise, and branded companiesĀ lack lower cost manufacturingĀ and supply chain capabilities, hybridizationĀ will likely continue.
ACQUISITIONS
Among M&A in 2014, global capacity,Ā ability to scale, and product portfolioĀ additions were the primary themes.Ā These deals demonstrate the strategicĀ intent as to where companies seeĀ their ability to execute and growāĀ traditional generics, generic biologics,Ā new delivery mechanisms, hybridization,Ā or all of the above.Ā While the mechanics of M&A areĀ not new, the ability for companies
to realize synergies are often suboptimizedĀ by inadequately addressingĀ the people and processes impacted.Ā Further, when appropriate TSA measuresĀ are not enforced, integrationĀ budgets are often inflated. WhenĀ using M&A to expand your portfolio,Ā due diligence requires particularĀ focus on skills, systems, and regulatoryĀ concerns.
DISTRIBUTION CHANNELS
Distributor and pharmacy partnershipsĀ are reshaping the generic drugĀ distribution channel. These partnershipsĀ increase scale and purchasingĀ power, putting pressure on genericĀ manufacturers.Ā Leading generic companies will tryĀ to think differently about the market.Ā Value for the pharmacy will becomeĀ a key differentiator with the growth ofĀ specialty pharmacies. Value for theĀ payers will be driven by the quality ofĀ healthcare outcomes. Anything thatĀ can be done to differentiate usingĀ value-added services is going to beĀ a critical strategy to combat volumeĀ pressure by the distributor channel.Ā Also the ability to capitalize on genericĀ launches of high-value branded drugsĀ and continued global expansion areĀ key strategies for success.
To read more about theĀ Generics Industry Trends, click on the PDF below.
