Cracking the Generics Code!
Believe it or not! They have done it! Three Indian drug companies have catapulted themselves into the top-ten fastest growing generic firms in the hyper-competitive, difficult-to-penetrate US generics market. These are Sun Pharma, Dr. Reddy’s and Glenmark. How did they achieve this? By exploiting the emerging opportunities right from their inception. By thinking big! By acting big!
It is a strange coincidence that the Hatch-Waxman Act (The Drug Price Competition and Patent Term Restoration Act Amendment) and the incorporation of these companies was around the same time. The year 1984. Sun Pharma started its operations in a small way in 1983, Dr. Reddy’s in 1984 and Glenmark although started its marketing operations 1977, it started its manufacturing plant only in 1984. The Hatch-Waxman Act played a significant role in accelerating the penetration of generics and the growth of the US generics business.
Sun Pharma, Dr. Reddy’s and Glenmark have been among the top ten generic drug firms in the US for highest growth achieved during 2011. The common thread running through their success in their success stories is their strategic foresight and execution capabilities. They have been preparing for this right from the start. The main areas of their strategic focus are: Product focus, technology up-gradation, and R&D commitment. Product focus resulting in getting the ANDAs (abbreviated new drug applications) for launching their generic products. Technology up-gradation and R&D commitment have led to superior formulation development capabilities that are essential to get the US FDA nod and developing world class generic products that match the innovators products like fingerprints.
Achieved total sales of US $ 1.65 billion in 2011, with US generics business accounting for about 43 per cent of the total sales including Taro Pharmaceuticals, where Sun Pharma holds a controlling stake of 66 per cent and 77 per cent of voting rates. The growth in the fiscal 2011 was a whopping 104 per cent over the previous year. The company has filed a staggering 377 ANDAs of which 225 have been approved.Sun’s R&D investment during the year was an impressive 9.4 per cent.
Achieved a total sales of US $ 1.48 billion in 2011 with a growth rate of 34 per cent. US generics accounted for 45 per cent of the total. The company has a total of 194 ANDAs (including partnered) in its basket with 104 approvals. What is noteworthy about this portfolio is that 7 of these are with first-to-file status, which when granted will have a 180-day exclusivity. The R&D spend was 7 per cent of the sales.
Achieved total sales of US $778 million with 37 per cent growth over the previous year. US generics business crossed the US $250-mark for the first time. The company had a total ANDA portfolio of 115 of which 73 have already been approved. The company spent 7.25 per cent of its sales on R&D.
These in a nutshell, are the success stories and the secrets behind them. They seemed to have cracked the generics code!