Hi I am Rahul Ranjan Rai, perusing MBA from Jaypee Business School and I have completed this Project under the supervision of Pro. Evan Costle (france). I hope this presentation will help you to understand the emerging concepts in Generic Industry Thank you Regards Rahul

1. Generic Pharmaceuticals
Industry on a Roll

2.  Generic Drug is a copy that is the same as a brand name drug
in dosage, safety, strength, how it is taken, quality,
performance and intended use
 drug is not sold as the brand name, but it has the identical
strength, dosage and route with brand-name drug
 Use of generic drugs is now widely accepted and they are
commonly prescribed by physicians and dispensed at
hospitals

3.  The generic drugs are less expensive as compared to
branded drugs as generic manufacturers do not have the
investment costs of the developer of a new drug
 When patents are nearing expiration, manufacturers usually
approach the Government/Drug Control Department to sell
generic versions.
 In the process, the consumers get genetic drugs at
substantially lower costs.
 Both branded and generic drugs are manufactured by
conforming to International standards

4.  Brand name drugs are usually given patent protection for 20
years from the date of submission of the patent
 After this period of time any company file to make its
generic version
 Generic substitution may not be appropriate in certain
circumstances where only a branded drug would be suitable
for the patient
 For some patient having generic drug may be a cause of
problem

5.  Generic drugs offer an important tool for reducing the rate of
growth in overall health expenditure.
 Generic drugs play an important role in health care and the
availability of generic drugs reduces the monopoly and
oligopoly powers of the patent holder.
 The Government may also impose compulsory licensing so
as to make available the much needed generic drugs.

6.  India already has well over 5 million people living with
AIDS
 India must provide medicines to hundreds of thousands
of people each year
 For lower cost of medical facility
 Reducing monopoly in the market
 For sustainable growth of other smaller pharma
industries

7.  India has had a vibrant generic industry since 1970
when it lawfully amended its existing patent act to
disallow patent protection for pharmaceutical
products.
 This action catapulted India from a medicine importer
to medicine self reliant nation
 From 10% of total markets world wide in 1995,
generic producers at this time supply around 65% of
global sales of, off patent products(Anon 1999)., while
35% comes from patented molecules

8.  India has been and remains the producer of choice for
medications in most developing countries, producing
medicines of assured quality that meet all international
standards, at the lowest costs and highest volumes.

9. Experience in reverse-engineering drugs
Cost advantages in research, development and manufacturing
Launch generic products in less regulated markets, then
regulated markets
Gain experience, Work out any is, Lower Costs, Experience in
cGMPs
 Investing capital; yearly estimates up 60% from 8 years ago
 Investing in infrastructure to better control processes
 Meet higher standards in regulatory requirements
 Drug Discovery Agree

10.  Aurobindo, Cipla, Glenmark, Jubilant, Lupin, Matrix, Orchid,
Sun Wockhardt, Zydus Cadila
 Geographic Growth
 through acquision
 increased doses product filing from less regulated
market
 limits depends on any regulated market
Growth Through Partnering
Need to compete on price in many cases

11.  Aurobindo 8-10 quarterly
 Cipla additional 35 prior to FY06
 Glenmark 14 within 2007additional 6-11 with partners
 Jubilant 15 in dev
 Ranbaxy 25 over next year
 Sun Pharmaceuticals 18 -20 per year
 Wockhardt 15 pending
 Zydus Cadila 16 in

12.  Zydus Cadila
 Distribution agreement with Mallinckrodt; limited period,
renewable
 50/50 JV with Mayne- cytotoxic dose and APIs
 Glenmark
 Development and Supply Agreement with KV for 8 ANDAs
 Invagen - 7 products
 Konec for nitroglycerin and Interpharm for naproxen
 Lupin
 Injectable ceph generics with Baxter
 Oral ceph generics with Watson

13.  Dr. Reddy
 Rheoscience- Phase III PPAR
 Argenta-COPD
 Formed drug dev company in India- Perlecan
 Glenmark
 Oglemilast licensed to Forest and Teijin (Japan)
 Ranbaxy
 GSK Drug Discovery & Clinical Development

14.  Big Pharma, companies in response to their loss of market
hegemony, have lobbied to strengthen intellectual property
protections for pharmaceutical products and processes
 Finally the U.S. Trade Representative-Big Pharma team
succeeded in imposing a patent-monopoly system on India
and other countries through the World Trade Organization
(TRIPS) Agreement of 1994.
 TRIPS required WTO member states to grant patents on all
classes of products (including medicines), to provide
protections for a minimum of 20 years

15.  Act creates rights to patent certain new uses, formulations,
delivery systems, combinations of existing products, and
minor variations of existing chemical entities.
 The act leaves in place India's procedurally laborious and
inefficient compulsory licensing scheme
 The act grants for patent applications between the
publication and approval of the patent deterring generic
entry even in cases where the patent application may later
be denied

16.  New Drug Application (NDA) is a document where in drug
sponsors formally propose that the FDA approve a new
pharmaceutical drug for sale and marketing in the United
States
 The NDA allows the FDA reviewer to determine:
 Whether the drug is safe and effective in its proposed use(s).
 Whether the benefits of the drug outweigh the risks.
 Whether the drug’s proposed labeling (package insert) is
appropriate, and what it should contain.
 Whether the methods used in manufacturing the drug and the
controls used to maintain the drug's quality are adequate to
preserve the drug's identity, strength, quality, and purity.

17.  During 1970-1990’s, due to patent expiry, generic
pesticides became the fastest growing sector elsewhere
as in India.
 From 10% of total markets world wide in 1995, generic
producers at this time supply around 65% of global sales
of, off patent products(Anon 1999)., while 35% comes
from patented molecules.
 In India too, major share of technical
production/markets comes from off patent/generic
products. The Patent Act will now usher in new
molecules – from R&D based Companies. Generics face
substitution and regulatory uncertainty elsewhere as in
India.

18.  Market for generics in India shows sure erosion in
price and value offered due to:
 Large capacity, both for actives/ formulations, at
regional/national levels – consolidation ?
 BT Cotton, changing pest/disease infestations,
transgenic crops impact on pesticide demand ?
 Imports from China etc. both legal and illegal result
in wide price difference for same molecules
between branded and generic producers.

19.  Local producers resorting to price discount strategy,
lowering the net value for all times..
 Availability of spurious/substandard products,ready
to sell network, and corrupt business environment.
kill brand value chain.

20.  We ourselves, the fragmented industry, for failing to
look at the global picture, tolerating illegality,
partnering corrupt practices, and by an absence of
product portfolio management.
 The Government, which is unable to provide a
healthy regulatory environment/understanding.
 The network and the supply chain, who has the last
laugh at the merry bunch of jokers involved in this
game of perpetual value reduction.

21.  The marketers who wish to easy sell and not work
on product stewardship - <quality <price….
 The end users who buy cheap products without
thinking of consequences on the crop.

22.  R&D companies are divesting actives,which can be
acquired by other generic producers.
 Actives registered before 1993 may not be
supported due to data generation costs by the
majors unless generic producers support use
extension for new crops. Generic producers must
produce and share data/costs and find new markets
 Allocate resources for product stewardship such as
resistance management, new usages, dose setting.

23.  Generic supply and demand issues, production
capacity rationalization, investment in data and
development.& exports, real challenges ahead!
 Govt. regulation will limit use of old generics.

24.  New solutions to crop/ Animal problems to meet
changing customer needs – need of hour.
 Performance enhancement of existing active
products by improving formulations, application
methods, and combinations.(registration).
 Offering generics as a part of crop solutions
package rather than as stand alone products.re-
launch generics – don’t write them off..
.

25.  Allowing easier route for Combinations Registration,
new formulations and export of generics. – is the
regulator listening?
 Produce newly off patent products with additional
services and performance/quality guarantees
 Manufacturers, distributors and dealers must stop
looking at generics as only(low) profit giving
commodities, but look at each product as a crop specific
solution provider. Large producers must assume
leadership role. Substitution must not be
automatic – it must be managed by design..

26.  Many off patent products outside India are potential
candidates to be examined for manufacture –
export, or domestic development, by Indian
manufacturers of actives. This needs positive fast
track registration regulation based on reasonable
data requirement.
 Parallel importers from China – eroding or adding
value? Introspection/regulation needs/partnership?

27.  R&D Companies in India, and large Indian producers
must look at potential partnerships, nationally and
regionally, to promote generics by creating a value
chain/brands/solutions – to coexist(peacefully) with
new (patented) products, and biotechnology or
genomic systems.
 Safer and newer formulations such as SC/WDG/ME
etc. must be encouraged to breathe some life into
generic value chain.

28.  Contract farming, agricultural retail, must get
involved into the generic value chain to deliver
quality to end users with monitoring capability.
 Minor use registrations must be on fast track, to
encourage precision farming.

29.  Regulation should be concerned with safety of
environment, quality, bio efficacy and MRL not with
market protection or data shields.
 Regulation should encourage sharing data,
partnerships and rules for data compensation,not
product monopoly..
 Playing with data exclusivity leads to market
exclusivity. Drives majors into investing time and
resources for minor changes rather than develop
innovative products.

30.  Patent protection is now 17 to 20 years. (ankit
check it out I think it is for 4,8 12 years
as well)
 Generic industry has a positive role to play.
Regulators must recognize this. So must industry.

31.  Indian Agrochemical industry in present form
unsustainable to support innovative strategies in
the future for generics.
 Food safety, environment, health, key
regulatory concerns – are these industry
concerns too?
 Corporate need to better handle its image.
 Our network – partners in crime or value?
 Provide services not only products!

32.  Regulation must facilitate sustainable agriculture
with industry, rather than make law to fill jails..
 Generics in India …..God & Rain be with you! They
are your only support left……..unless..

34. Position 2006 company No of R&D products No of own
(2005) in 2005 (2004 products
1 (1) Sanofi-Aventis 205 (226) 139
2 (2) GlaxoSmithKline 181 (170) 123
3 (4) Merck & Co 159 (128) 119
4 (3) Hoffmann-La Roche 145 (144) 72
5 (7) Novartis 123 (109) 66
6 (5) Johnson & Johnson 116 (117) 65
7 (6) Pfizer 109 (115) 68
8 (8) AstraZeneca 108 (105) 81
9 (12) Astellas 89 (68) 52
10 (10) Bristol-Myers 81 (84) 50
Squibb

35.  Overall 28.2% of pipeline projects are targeted against cancer, indicating that
oncological agents account for almost a third of drugs in R&D. This figure has
consistently increased year-on-year, as the industry focuses on this massive killer
which will affect one in three of us in our lifetimes.
 It is also an area which has made huge strides therapeutically, and one for which
targeted treatments can command high prices.
 Elsewhere, diabetes is another area which continues to see growth, as the
prevalence of the disease rises due to poor western diets. The 10% growth in the
size of the antidiabetic pipeline is certainly significant. Vaccine R&D has increased
by an even greater percentage, as emerging infections continue to challenge the
global community.
 Also posting an increase, although slipping down the chart, is the analgesic
category, which continues to build on rises reported last year. Also of interest are
the fact that gene therapy has arrested its decline, and Parkinson’s disease and
multiple sclerosis appear to be other growth areas.

36.  Opportunity and threats for generics

37.  Increasing demand for low-cost therapies
 Aging population
 Consumers becoming more cost sensitive
 Increased generic substitution
 Government involvement
▪ US Medicare Drug reimbursement
▪ Reference pricing in Europe

38. Percent of Population over 60
10
20
30
40
0
Less Dev
World
1950
More Dev
1975
2000
2025
2050

42.  Products with $100B in branded drug sales
are coming off patent in the next 7 years
 Patent challenges by generic companies

43. 25 40
patent (Newport Constraint Date)
20.1
Number of drugs coming off
20
18.4 30
Sales Billions USD
15.2
15
12.4 12.3 20
10.5 10.0
10
Top 5
Sales
10
5
0 0
2006 2007 2008 2009 2010 2011 2012

47.  Rapid price erosion in the U.S. and UK
 Diminishing margins on both dose and API sales
 New regulations in Germany (AVWG)
 Settlements between generics and brand
companies are delaying generic entry in the U.S
(leapfrog strategy ).

48.  ANDA approval backlog in the U.S.
 Fewer new launches by innovators over the past
years will translate into fewer opportunities for
generics down the road
 Tie up between patient drug maker and generic
drug maker before the patient get over (Foresight)

49.  Demand
 Purchasers focus on price
 Past relationships matter less
 Reverse auctions
 Supply
 Generic filings and approvals at all-time high
 A number of new entrants, many from India, often with
access to low- cost APIs
 Overcapacity in manufacturing
 Focus on market share rather than bottom line
 Authorized generics in the U.S.

50.  Consolidation
 Geographic diversification
 Backward integration into API
 Sourcing from India, China, and other low-cost
countries
 Alliances with companies in low-cost countries
 Moving manufacturing to low-cost countries
 Focus on niche products

51.  Will focus on price backfire?
 Is the number of suppliers going to decrease enough
to give the remaining players more negotiating
power?
 What will be the impact of generic entries from
China?

52. Thank you