Generic drugs to rule the market in the near future: Experts

According to the latest estimates for global drug sales, generic drug makers are going to be in for bumper profits. The growth in generics is expected to depress overall ‘pharma’ sales growth, as lower-priced copies replace top-dollar brand names. In fact, global sales growth could be reduced by half over the next five years, say experts.

The numbers come from IMS Health which says that average annual sales will grow from 3 percent to 6 percent through 2015, to nearly $1.1 trillion. This is however slower than the average annual growth of 6.2 percent during the last five years.

As one might expect, given the numbers on emerging markets, future growth will be weighted toward the developing world, with U.S. sales projected to rise by 3 percent at the most per year, or not at all. European sales are projected to increase by 1 percent to 4 percent. What's more, that growth will come in the form of increased generics sales; branded drug sales are expected to be mostly flat.

“There are unprecedented dynamics at play, which are driving rapid shifts in the mix of spending by patients and payers between branded products and generics,” as IMS Health's Murray Aitken said. Too few novel drugs are winning regulatory approval to offset that big shift in spending mix, he explained.

The U.S.'s share of global drug sales will drop to 31 percent in 2015, down from 41 percent in 2005. The top five European countries, which accounted for 20 percent of spending in 2005, will make up only 13 percent. But the 17 “pharmerging markets,” led by China, will account for 28 percent of total spending by 2015, up from 12 percent in 2005.

Global spending on cancer drugs is expected to reach $75 billion by 2015, rising at a much slower rate than in the past five years because many newer and costly biotech treatments are already being widely used in developed markets. But annual spending on diabetes medicines is expected to grow 4 to 7 percent through 2015, due largely to changing diets and lifestyles in developing countries that will increase the prevalence of Type II diabetes.

A wave of new generics is approaching as an unprecedented number of big drugs lose U.S. patent protection by 2015, including Pfizer Inc's $10 billion-a-year cholesterol fighter Lipitor, Bristol-Myers Squibb Co's Plavix blood clot preventer and Eli Lilly and Co's Zyprexa for schizophrenia. All told, cheaper generic formulations of the maturing drugs will produce $98 billion in net savings to insurers in developed countries through 2015.

Dr. Ananya Mandal

Written by

Dr. Ananya Mandal

Dr. Ananya Mandal is a doctor by profession, lecturer by vocation and a medical writer by passion. She specialized in Clinical Pharmacology after her bachelor's (MBBS). For her, health communication is not just writing complicated reviews for professionals but making medical knowledge understandable and available to the general public as well.

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