The growth in the sale of generics growth slowed to 3.6 percent in the 12 months ending in September, compared to 11.4 percent in the prior year, according to IMS Health, a market-research firm. By comparison, the global generics market, which now stands at $78 billion in sales - had posted double-digit percentage growth 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," Murray Aitken, an IMS senior vp, says in a statement. “This trend is very apparent in markets like the U.S. and U.K. as generics companies contend with aggressive competition and cost-containment measures enforced by both private and government payers.”
The US, which is the world’s largest generics market with 42 percent of global sales, saw a 2.7 percent sales decline in the twelve months ending September 2008 while volume increased 5.4 percent during the same period. Generics now account for 63.7 percent of the total US pharma market volume. The US generics market is currently valued at $33 billion, compared with $34 billion last year, reflecting declining prices and fewer blockbusters losing patent protection in 2008, according to IMS.
The top 10 generics companies currently hold a 47 percent share of the generics market worldwide. The three leading generics manufacturers are Teva with 11 percent market share, Sandoz with 9 percent, and Mylan with 8 percent.
4 Comments
Ed
I know its very tricky to write a headline about growth slowing, but your headline seems to imply (at a quick read) that generics are declining, not that they aren't growing as fast as they used to. Many reporters get that subtle point wrong, leading to the wrong conclusion.
PP
Hi PP,
Yes, headlines are very tricky sometimes. And I appreciate your point. In my limited view, the idea that sales are slowing is another way of saying growth isn't happenin as quickly. Put yet another way, sales aren't accelerating either. But I understand the subtleties and will try to do my best.
Thanks for stopping by, Ed
I agree with PP, I was a bit surprised by the headline since it was contrary to what I've seen with generic uptake. Volumes are clearly still increasing, revenue growth is obviously going to slow in any market where you have new players flooding into the market. Generic simvastatin was a cash cow for awhile for a small # of players, but the margins are getting squeezed out quickly. But that isn't to say that generic simvastatin didn't have a stellar growth year in 2008 from a volume perspective.
Dingle
Hi Dingle,
Understood, although revenue and volumes can be two different things, and the headline refers to sales growth, as IMS captures it, anyway.
Regards ed