This report was presented at the Pharma Tech 2013 Conference - India A Game Changer in the Pharma Industry at Ahmedabad, India in December 2013. The presentation highlights the overview of the global generic pharmaceuticals market, with particular focus on the key market trends and challenges by therapeutic areas and geographies including the U.S, EU and India. List of key blockbuster drugs scheduled to lose patent protection between 2010 and 2020 have been included. Additionally impact of regulation on generic drugs by region and strategic recommendations for the success of market participants are also covered in this report.

1. Global Generic Pharmaceutical Market – Qualitative
and Quantitative Analysis
Aiswariya Chidambaram
Senior Research Analyst - Life Sciences
Pharma Tech, Ahmedabad
12-11-2013

2. Focus Points
Generics Lead the Way Ahead
Global Generic Pharmaceutical Market – Patent Cliff
Key Therapeutic Areas Overview
Key Therapeutic Areas Growth Analysis
Key Market Drivers and Challenges
Mergers & Acquisitions Outlook
Focus Points
Competitive Landscape Analysis
U.S. Generic Pharmaceutical Market Overview & Regulatory Analysis
European Generic Pharmaceutical Market Overview & Regulatory Analysis
Indian Generic Pharmaceutical Market Overview & Regulatory Analysis
Future Trends and Directions – Vision 2025
Strategic Recommendations
2

3. Generics Lead the Way Ahead
The global generic pharmaceutical market worth over $150
billion in 2013, growing at CAGR (2013 – 2018) of 8.4%
U.S world’s largest generics
market (45%).
India and China - huge generic
markets in production volume.
Over the next five
years
Emerging markets 15 % to 20% growth.
Matured markets – 6%
to 10% growth.
The top eight
global markets
comprise 80% of
the total generic
sales.
Blockbuster drugs
($150 billion) to lose
patents between 2010
and 2017.
The top ten global generic companies account for 47%
market share.
Source: Frost and Sullivan

4. Global Generic Pharmaceutical Market – Patent Cliff
Total Pharmaceutical Market: Sales Value of Drugs Losing Patent
Protection (Global), 2007 - 2017
 Generic companies have been proactive in
filing for marketing rights and exclusivity
well ahead of patent expiry.
42.11
45
 Ranbaxy was the first filer of ANDA for
generic Lipitor in November 2011 while
Watson Pharma was to sell authorised
generic version in the U.S.
Sales ($ Billion)
40
33.43
35
30
25
20
33.18
27.79
24.33
16.95
15.21
15
7.08
10
8.13 7.96
2.96
5
0
 Teva was awarded with 180 days
exclusivity to sell generic Losartan while Hi
Tech Pharmacal successfully challenged
J&J’s Levaquin (oral solution).
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Year
 The U.S. patent for AstraZeneca’s Crestor
was challenged by Apotex, Mylan and
Sandoz.

5. Key Therapeutic Areas Overview
Generic Pharmaceutical Market: Percent Revenue Contribution by Therapeutic Segments (Global)
16.1%
35.1%
21.7%
0.2%
6.4%
3.4%
CNS
Cardiovascular
Dermatology
8.3%
Genitourinary/Hormonal Drugs
4.5%
4.3%
Respiratory
Rheumatology
Diabetes
Oncology
Others
Note: All figures are rounded;. Source: Frost & Sullivan
Others include Gastro-intestinal, HIV, Immunology and so on.
 Cardiovascular and CNS are the two largest market segments, constituting nearly 38% of the global generic
pharmaceutical market together.
 However, therapeutic segments such as Respiratory, CNS and Oncology are likely to witness significantly high
growth rates, attracting the attention of market participants.
 On the contrary, segments such as Diabetes and Genitourinary/ hormonal drugs are expected to decline by the
2017.

6. Key Therapeutic Areas – Growth Analysis
20%
14%
The patent expiry of several key
antipsychotics and anti-depressants
contribute to the rapid growth of CNS
drugs market between 2010 and 2017.
Development/
Fast Growing
12%
C
A
G
R
Fast
Growing
10%
8%
The reason behind such
enormous growth is the
massive
number
of
patent expiries. Almost
half of the global asthma
and COPD market drugs
are set to lose patent
protection by 2016.
Development/
Fast Growing
Fast
Growing
Growing
Growing
One of the promising
segments for generic
participants to venture
between 2010 and
2015 is oncology as
drugs worth $10 b are
set to lose patent
protection by 2015
6%
4%
CNS
Oncology
Bubble size represents market value
Rheumatology
Declining
Declining
Stable
Intense
competition,
promotion of branded
drugs
and
new
innovative formulations
such as
inhalable
insulin are all likely to
deter the growth of
generics.
2%
Cardiovascular
Relatively
lesser
number of drugs are
subjected to generic
exposure during the
forecast period and
hence the decline in
growth.
Respiratory
Diabetes
Dermatology Genitourinary
Others
Source: Frost & Sullivan analysis.

7. Key Market Drivers and Challenges
Key Drivers
Patent expiry of key
blockbuster drugs
worth $150 billion.
Access to emerging
markets and niche
therapeutic segments
New provisions
introduced by
governments
Price control measures
introduced by
governments
Changing population
demographics and
lifestyle patterns
Intense price
competition due to
imports from low-cost
markets
Increasingly
stringent
regulations to
safeguard quality
Key Challenges
Source: Frost & Sullivan analysis

8. Mergers & Acquisitions Outlook
Generic Pharmaceutical Market: Number of Deals and Amount Spent on Mergers & Acquisitions (Global), 2000 - 2009
30.00
90
80
70
20.00
60
50
15.00
40
10.00
30
Number of Deals
Total Value of Deals ($ Billion)
25.00
20
5.00
10
0.00
0
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
Year
Total Value of Deals
Number of Deals
Note: All figures are rounded; Source: Frost & Sullivan analysis.
The number of deals and the total expenditure on mergers and acquisitions have been increasing steadily over the years
since 2000. There was a peak in M&A activity in 2005 and 2008. The trend is likely to continue with all the key generic
participants increasing their dependence on strategic alliances to conquer market shares.
Source: Thomson Reuters and Frost & Sullivan analysis.

9. Competitive Landscape Analysis
Generic Pharmaceutical Market: Ranking of Top Five Companies by Market Share (Global)
Rank
Company
 The top three companies namely Teva, Sandoz and
Mylan registered significant growth rates of 16, 14
and 11% respectively in 2010 - 2011.
1
 Most of the big companies prefer mergers and
acquisitions to organic growth as a faster means to
consolidate and expand their market shares.
2
3
 The top five generic pharmaceutical companies
accounted for 40% of the share in the global generic
pharmaceutical market.
Mylan
4
5
Source: Frost and Sullivan analysis

10. U.S. Generic Pharmaceutical Market
 World’s
largest
generic
pharmaceutical
market
represents 45% of global share.
 More
than
500
industry
participants
–
top
five
companies constitute 50% sales
 Highly saturated – highest
levels of generic penetration
 Most attractive hub for lowcost destinations like India,
China – increased pricing
pressure
 Predominantly
unbranded
generics (INN prescribing)
Market Overview
 Characterized by high levels of
generic prescribing, strong IP
legislations, retailers purchasing
on price
 Blockbuster drugs worth over
$67 billion to lose patent
protection
 Aggressive patent challenges
and Paragraph IV filings
 Mergers and acquisitions most sought-after trend in the
U.S.

11. Key Blockbuster Drugs Losing Patent Protection – U.S.
Pharmaceutical Market: Key Blockbuster Drugs Losing Patent Protection (United States), 2010-2017
2010
2011
2012
2013
2014
2015
2016
Atorvastatin
Clopidogrel
Candesartan
Cilexetil
Duloxetine
Aripiprazole
Epoetin alfa
(Procrit/ Eprex)
Adalimumab
Docetaxel
Goserelin
Enoxaparin
Filgrastim
Celecoxib
Imatinib
mesylate
Ezetimibe
-
Latanoprost
Epoetin beta
Insulin
lispro
Darbepoetin
alfa
Pregfilgrastim
Lopinavir
with
Ritonavir
-
Levofloxacin
Escitalopram
Oxalate
Interferon
beta – 1a
(Avonex
Esomeprazole
Magnesium
Rituximab
Olmesartan
Medoxomil
-
Interferon
beta – 1a
Glatiramer
Trastuzumab
-
-
Donepezil
Fluticasone
propionate with
Salmeterol
Xinofoate
Gemcitabine
Olanzapine
Etanercept
(Rebif)
acetate
2017
Oseltamivir
Source: Frost and Sullivan analysis
11

12. Key Blockbuster Drugs Losing Patent Protection – U.S.
(continued)
Pharmaceutical Market: Key Blockbuster Drugs Losing Patent Protection (United States), 2010-2017
2010
2011
2012
2013
2014
2015
2016
2017
Losartan
Pioglitazone
Irbesartan
Rabeprazol
e
Infliximab
-
-
-
Pantoprazole
Quetiapine
Montelukast
Risedronate
Raloxifene
-
-
-
-
Peginterferon
alfa 2a
Simvastatin
with
Telmisartan
-
-
-
-
Ezetimibe
-
-
Rosiglitazone
TacrolimU.S
.
Tiotropium
-
-
-
-
-
Rosuvastatin
Oxaliplatin
-
-
-
-
-
-
Sildenafil
-
-
-
-
-
-
-
Tolterodine
-
-
-
-
-
-
-
Valsartan
-
-
-
-
-
Source: Frost and Sullivan analysis
12

13. Regulatory Impact Analysis – U.S.
Regulatory Environment in the U.S Generic Pharmaceutical Market
Hatch-Waxman Act
Gregg-Schumer Act
Pricing & Reimbursement
• “Generic companies could
obtain market authorisation
by proving bioequivalence
of generics to brands
• “Single 30-month stay”
granted
to
branded
company
for
patent
infringement suit
• Safe Harbour Provision:
experimental
use
of
patented drugs permitted by
generic companies
• Stay to run concurrently
with FDA’s consideration
of application
• 180-day market exclusivity
for
first-to-file
generic
applicant
• 30-month stay for patents
listed in Orange Book
• No significant
generic entry
delay
in
• Allows generic companies
to
file
counterclaims
against innovators
• Generic drug price ranges
from
90%
of
brand
equivalent with just 1
competitor 5% with 16-20
competitors
• Medicare Prescription Drug,
Improvement
and
Modernization Act (MMA)
2003
• Medicare reimburses drugs
based on weighted average
prices
• Competitive
practiced
bidding
is
Source: Frost and Sullivan analysis
13

14. Europe Generic Pharmaceutical Market
 Mature markets (Germany, the
UK) to present sluggish growth
between 5 – 6%
 Top five countries – Germany,
the United Kingdom, France, Italy
and Spain represent 50% volume
share and 18% value share
globally.
 Italy and Spain are expected to
register higher growth rates
between 18 – 20%
 As per EGA, generic drugs
generate savings of €30 billion.
 Eastern Europe to contribute
maximum growth
Market Overview
 Germany and the UK are highly
penetrated generic markets
 Europe primarily dominated by
branded generics except the UK
 Represent 64% and 60% of
volume share respectively in
Europe.
 Calcium
antagonists,
antiulcerants and platelet inhibitors
to face high generic competition
 Germany is the largest generic
market in Europe accounting for
27% sales
 Highly fragmented market with
county-specific regulations
Source : Frost & Sullivan analysis.
M74E-52
14

15. Key Blockbuster Drugs Losing Patent Protection – Europe
Pharmaceutical Market: Key Blockbuster Drugs Losing Patent Protection (Europe), 2010-2017
Drug
France
Germany
Italy
Spain
U.K.
Anastrozole
2010
2010
2010
2010
2010
Aripiprazole
2011
2011
2011
2011
2011
Atorvastatin
2011
2011
2011
2011
2011
Candesartan Cilexetil
2012
2012
2012
2012
2012
Celecoxib
2014
2014
2014
2014
2014
Clopidogrel
2013
2013
2013
2013
2013
Darbepoetin alfa
2014
2014
2014
2014
2014
Docetaxil
2010
2010
2010
2010
2010
Donepezil
2012
2012
2012
2012
2012
15

16. Key Blockbuster Drugs Losing Patent Protection – Europe
(continued)
Drug
France
Germany
Italy
Spain
U.K.
Duloxetine
2012
2012
2012
2012
2012
Escitalopram Oxalate
2014
2014
2014
2014
2014
Esomeprazole
Magnesium
2010
2010
2010
2010
2010
Etanercept
2014
2014
2014
2014
2014
Ezetimibe
2017
2017
2014
2017
2017
Fluticasone propionate
with Salmeterol xinofoate
2013
2013
2013
2013
Invalidated
Glatiramer acetate
2015
2015
2015
2015
2015
Imatinib mesylate
2016
2016
2016
2016
2016
Infliximab
2014
2014
2014
2014
2014
16

17. Key Blockbuster Drugs Losing Patent Protection – Europe
(continued)
Drug
France
Germany
Italy
Spain
U.K.
Insulin glargine
2014
2014
2014
2014
2014
Insulin lispro
2010
2010
2010
2010
2010
Interferon beta 1a (Rebif)
2013
2013
2013
2013
2013
Irbesartan
2013
2013
2013
2012
2013
Levofloxacin
2011
2011
2011
2012
2011
Lopinavir with Ritonavir
2016
2016
2016
2016
2016
Montelukast
2012
2012
2012
2012
2012
Mycophenolate mofetil
2010
2010
2010
Expired (2007)
2010
Olanzapine
2011
2011
2016
2011
2011
17

18. Key Blockbuster Drugs Losing Patent Protection – Europe
(continued)
Drug
France
Germany
Italy
Spain
U.K.
Olmesartan medoxomil
2017
2017
2017
2017
2017
Oseltamivir
2017
2016
2017
2017
2016
Oxaliplatin
2013
2013
2013
2013
2013
Pegfilgrastim
2017
2017
2017
2017
2017
Peginterferon alfa-2a
2013
2013
2013
2013
2013
Pioglitazone
2011
2011
2011
2011
2011
Quetiapine
N.M
2012
2012
2012
2012
Rabeprazole
Expired
(2007)
2012
2012
2012
2012
Risedronate
2010
2010
2010
2013
2010
18

19. Key Blockbuster Drugs Losing Patent Protection – Europe
(continued)
Drug
France
Germany
Italy
Spain
U.K.
Rituximab
2013
2013
2013
2013
2013
Rosiglitazone
2013
2013
2013
2013
2013
Rosuvastatin
2017
Not mentioned
2012
Not mentioned
2017
Sildenafil
2013
2013
2013
2013
2013
Telmisartan
2013
2017
2017
2013
2017
Tiotropium
2016
2015
2014
2015
2012
Tolterodine
2012
2012
2012
2012
2012
Trastuzumab
2012
2012
2012
2012
2012
Valsartan
2011
2011
2011
2011
2011
Zoledronic acid
2012
2012
2012
2012
2012
19

20. Regulatory Impact Analysis - Europe
Regulatory Environment in the European Generic Pharmaceutical Market
Data Exclusivity
• Uniform level of data
protection
of
originator products for
10 years
• Permits to access data
of
a
generic
application but the
generic
version
cannot be launched
until the completion of
the ten-year period
8+2+1 Formula
European Bolar Clause
European Bolar Clause
• Originator companies
are granted 8-year
data exclusivity and 2
years
market
exclusivity
• Permits initiation of
generic R&D activity
prior
to
patent
expiry of brands
• Additional one year
exclusivity
awarded
for
new
product
indications and those
shifting
from
“prescription only” to
OTC
• Generics can enter the
market only after the
10th or 11th year
• Withdrawal
of
brands
before
generic entry cannot
stop
generic
companies
from
using
them
as
reference products
Sunset Clause
• Allows cancellation
of
marketing
authorization
for
products
not
in
market for 3 years
• Legal challenges by
patent owners can
prevent
generic
companies
from
applying
registrations
more
than 3 – 4 years in
advance of patent
expiry
Source: Frost & Sullivan analysis.
20

21. Regulatory Policies of Key Generic Markets in Europe Comparative Analysis
Generic Pharmaceutical Market: Impact of Regulatory Policies (Europe)
Policies
Germany
United
Kingdom
France
Spain
Italy
Reference pricing
Patient co-payment
Generic prescribing
Generic substitution
Time delay in market
access
High
Low
Source: Frost & Sullivan analysis.
21

22. Indian Generic Pharmaceutical Market
 Branded generics dominate the
Indian pharma market (98%)
valued at over $12.00 billion
 Highly fragmented market with
more than 22,000 registered
units
 World leader in exporting
generics to foreign countries;
exports growing at 22%
 Companies such as Sun,
Lupin, Aurobindo, Dr.Reddy’s
Laboratories, Cipla and Ranbaxy
have been aggressive in DMF
and ANDA filings with an
granted approval rates of 35%
 Anti-infectives and GI constitute
30% revenue share
Market Overview
 India produces 20 – 22% of
world’s generic drugs including
nearly 60,000 generic brands
covering 60 key therapeutic
areas
 Ranks
third
in
API
manufacturing accounting for
6.5% of world API production
 Top ten players account for
37% market share in India
Consolidation in the form of
strategic
alliances
between
Indian and foreign companies is
on the rise
 Extremely promising future for
generics in India
Source: Frost and Sullivan analysis

23. Export of Indian Generics to the U.S.
Total Pharmaceutical Market: Breakdown by
Domestic Sales and Export Sales (India)
 Steep rise in export of Indian generics to
the U.S. over the last five years
 Currently generic drugs from India
represent 18% of generic drugs in the U.S.
Export
52 %
Domestic
 India has more than 75 U.S. FDA approved
plants and tops the world in DMF and ANDA
filings in the U.S.
48 %
 Indian generic firms directly compete with
multinational generic companies leading to
Intensified price competition in the U.S.
 It is estimated that India is likely to capture
at least 30% of replacement generic
equivalents in the U.S. by 2018
Source: Frost and Sullivan analysis

24. Regulatory Impact Analysis - India
Pharmaceutical Policy
Drug Policy 1996
Pharmaceutical Policy 2002
National Pharmaceuticas Policy 2006
Quality Control
Price Control
On Prices
GMP/cGMP
Drug and Cosmetic Act 1940
Schedule M
Schedule Y
On Margin
Bulk Drugs
Formulations
IPR Protection
Essential Commodities Act 1955
Drug (Price Control) Order 1995
Amended Patents
Patents Amendment Act 2005
Source: Frost and Sullivan analysis

25. Regulatory Impact Analysis – India (continued)
Regulatory Environment in the Indian Generic Pharmaceutical Market
Pricing & Reimbursement
• The revised policy of the
National
Pharmaceutical
Policy
Authority,
has
capped margins on generic
drugs
at
15%
for
wholesalers and 35% for
retailers
• Price controlled drugs
Category I: Essential drugs
Category II: All drugs not in
Category I
• Drugs exempted from price
control required to meet
specific criteria
Patent Protection/ IP Rights
Quality Control
• Patents Amendment Act
2005 (TRIPS Agreement)
strictly prohibited reverse
engineering of drugs
• The Drug and Cosmetics Act
(D&C)
1940
regulates
import,
manufacture,
distribution and sales
• Covers two types of
generic drugs – off patent
generics and generics of
drugs patented before
1995
• Schedule M – requirements
for factory premises, plant,
materials,
plant
and
equipment
• Introduced
compulsory
licensing for exports
• Schedule Y – legislative
requirements for clinical
trials
• Mainly encourages foreign
companies to trade in
India
• Increasing
regulatory
compliance in India boosts
confidence of MNCs
Source: Frost and Sullivan analysis
25

26. Future Trends and Directions – Vision 2025
Balance in terms of healthcare expenditure and sales revenue is likely to shift from developed
markets to emerging markets.
Consolidation is expected to remain the key factor for growth and sustenance of generic
companies.
Large generic companies are likely to increase their investments in R&D activities
Key Trends
Technology
Development of Transgenic technologies
Stem cell technologies
Cloning technologies
Generic consumption is likely to be favoured in a big way by the government, payers,
policy-makers and physicians.
Increasing focus on higher value biological therapies, biosimilars,
controlled release products, sterile formulations and niche therapeutic segments.
Source: Frost and Sullivan analysis

27. Strategic Recommendations for Success
Strategy is a style of thinking, a conscious and deliberate process, an intensive implementation system, the science
of insuring future success – Pete Johnson
Differentiated Approach
Explore New Avenues
Big multinational generic
firms require to focus on
 Products with
technologically
challenging formulations.
 Products which require
significant regulatory
support.
 Products with limited
availability of APIs.
 Analyze prospects for
market globalization
- Strategic alliances
between multinational
generic firms and
domestic participants with
locally restricted
operations.
Medium-sized generic firms
require to focus on
 Products with relatively
higher profit margins.
 Appropriate time of entry
into the right market.
 Strengthen distribution.
Instill Competitive Capabilities
 Invest in R&D.
 Improve product line.
 Defend company’s
position in the market.
 Strike a balance
between supply and
demand side.
 Pioneer new and better
technologies.
Plan Ahead for the Future
 Research customer
needs, preferences,
expectations.
 Monitor new
technological
developments to face
the change.
 Target therapeutic
areas with high levels
of unmet clinical
needs.
Source: Frost and Sullivan analysis

28. Related Market Research Reports

Global Pharmaceutical Contract Manufacturing Market

Global Next Generation Biosimilars Market

Global Contract Research Outsourcing Market
28

29. Questions

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31. Contact Information
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AISWARIYA CHIDAMBARAM
Senior Research Analyst – Life Sciences
Frost & Sullivan (I) Pvt. Ltd.
ASV HANSA
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