Mumbai: Operating profit of India's leading drug companies such as Ranbaxy Laboratories, Dr Reddy's Laboratories, Sun Pharma and Wockhardt , who specialize in the global supply of generics or copycat drugs of patented medicines, may be hit as global prescription sales in value terms drop.
Sales growth of generics drugs has dropped to 3.6 per cent in the 12 months ended September 2008 compared with 11.4 per cent growth a year earlier, according to the latest report of IMS Health, the leading provider of market intelligence to the global pharmaceutical and healthcare industries.
Global generics products generated $78 billion in audited sales in the twelve months' period, said IMS Health. US, the world’s largest generics market with 42 per cent of global sales, has experienced a 2.7 per cent sales decline in the twelve months period posting sales of $33 billion, compared with $34 billion last year. However, sales by volume increased by 5.4 per cent in the US, reflecting declining prices and fewer blockbusters losing patent protection in 2008. Generics products now account for 63.7 per cent of the total US pharmaceutical market volume.
Indian drug makers account for a minimum 10-15 per cent of the global generics drug sales, headed by Israel-based Teva with 11 per cent market share, Novartis's generics arm Sandoz with 9 per cent, and US- based Mylan with 8 per cent. The top ten generics companies currently hold a 47 per cent share of the generics market worldwide.
India's Pharmaceutical Export Promotion Council had predicted the global recession could pull down India's pharmaceutical exports for 2008-09 to $8.25 billion, lower than the earlier estimate of $8.97 billion, with an export growth of 13.89 per cent as against the earlier estimate of 23.87 per cent.
"Cash-crunch hit drug importers from various parts of the US, Europe and other markets were instructing Indian drug exporters to stop shipments to clear their inventories and this could impact our export figures for 2009-10," Venkat Jasti, chairman, had said Pharmexcil told Business Standard two weeks ago.
“The global generics market has posted double-digit gains in recent years. But in 2008, despite robust volume increases, we are seeing the first significant decline in sales growth as manufacturers increasingly compete in fierce price battles within most of the world’s major markets,” commented Murray Aitken, senior vice president, Healthcare Insight, IMS. However, generics sales rose 10.2 per cent in Japan, 16.9 per cent in France, 12.5 per cent in Italy and 10.5 per cent in Spain in the twelve months through September, said the report.
Source : Business Standard