Indian cos? going gets tough in US generics market

Tough competition from peers and global generic firms is cluttering up the space for Indian companies in the off patent drugs market in USA that will reach $60 billion by 2011. The latest instance is that of the race for a pie of Wyeth’s $3-billion anti-depressant drug, Effexor XR in the US market, with more Indian companies entering with their generic versions. After separate litigations filed by Zydus Cadila and Torrent Pharma with Wyeth to launch the generics, Lupin has now reached a settlement with the US firm, allowing Lupin to launch the drug by June 1, 2011.

However, Lupin and others cannot expect to reap a windfall with the generic version of the drug as the market would be reduced substantially with the presence of too many generics by the time of the launch.

Once all the companies enter the US market with their own copycat versions following a patent expiry, margins could come down to as low as 2-3%, according to Ranjit Kapadia, a pharma analyst with HDFC Securities.

For instance, Effexor sales has dipped 4% for the last financial year to $3.92 billion and for the last quarter declined 7% to $902 million.

Global generic major, Teva has already received a 6-month exclusivity to launch the drug by July 1, 2010. The US-based Impax Labs also has settled with Wyeth and will launch its drug in June 1, 2011. Another player, Mylan, has received the tentative approval. Also, last year, the US FDA has granted approval to Osmotica Pharma?s tablet versions of Effexor XR, by asking Sun Pharma to refrain from its ANDA for the same versions.

Kapadia said, ?The US market for Effexor XR will be reduced substantially by 2011. These developments point that Lupin may not have an advantage from its launch in 2011. Wyeth has already launched another version of the Effexor XR named, Pristiq (desvenlafaxine), the patent of which will be expired in 2022, with asking patients to switch over from Effexor XR to Pristiq.? The first patent of Pristiq expire in February 2022. A Lupin spokesperson refused to comment on queries citing confidentiality of agreement with Wyeth.