Indian Generics in the USA: Destined for More Success?

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A recent IQVIA report highlights the increasing importance of Indian firms to the USA’s burgeoning generic pharmaceuticals market.

 

Now accounting for over 90 percent of all prescriptions dispensed in the USA, generic drugs play a vital role within US healthcare and have come a long way since their use was first approved in the country by the Hatch-Waxman act of 1984. The US generics market stood at USD 69 billion in 2018 and is expected to grow to USD 86 billion by 2022 (see chart below)

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Abbreviated New Drug Applications (ANDAs), whereby a company seeks authorisation from the US FDA for a generic copy of a previously approved drug, are on the rise. At the forefront of this trend are major Indian pharma players such as Cipla, Zydus Cadila, Dr. Reddy’s, and Sun Pharma, which are making up an increasingly large share of overall applications (see chart below).

The IQVIA report estimates that Indian pharma companies’ percentage share of ANDA approvals will increase from the 38 percent it stood at in 2017 to between 43 and 45 percent in the next few years thanks to the big players’ increased spending on R&D and an influx of new entrants to the market.

As Cipla’s global CEO and managing director, Umang Vohra, told PharmaBoardroom back in 2018, “our repositioning is about ensuring a strong stance in the US market. Cipla is not a company that had an aggressive market penetration in the country from the beginning. The rationale behind this decision is the firm belief that we have the required knowledge of the types of products that will soon go off-patent and are difficult to reproduce. A therapeutic area where we believe we can contribute greatly is, for instance, oncology. It is on the back of this that we are trying to build our business in the US. We are looking at how we can exploit the capability that we have better than other companies.”

Noting the sheer scale of the US generics market, Sharvil Patel, managing director of Zydus Cadila, added, “with the acquisition of US-based Sentyln, we are looking to reach the US market which accounts for the 60 percent of the entire generic ecosystem.”

 

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One potential stumbling block to Indian companies making further inroads into the US generics market is regulatory compliance. As India has the highest number of US FDA-approved finished dosage facilities of any nation on earth – over 200 – the FDA has ramped up the number of inspections being carried out at Indian facilities (see chart below).

As Letitia Robinson, director of the US FDA’s India office explained to PharmaBoardroom back in 2018, “India is a significant player in the global marketplace, representing an important source of FDA-regulated products. Indian regulators have become important strategic partners for FDA. Today, we regularly engage with them on everything from sharing information on FDA guidance and regulations to collaboratively addressing product safety issues.”

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The IQVIA report concludes by noting that although the US generic market will become more challenging in the medium term, Indian companies with clear pipeline visibility, robust US supply chains, and quality standards are destined to achieve even greater success.

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