The patent expiry of blockbuster drugs over the next year four years presents a fresh growth opportunity for the domestic pharma companies. As per CareEdge, drugs generating nearly $142 billion in annual sales in CY25 are expected to lose exclusivity between 2026 and 2030. After accounting for significant price erosion, this is expected to create a market opportunity of over $30-40 billion, out of which, Indian companies are expected to capture nearly $3-5 billion.
However, the report said that unlike the previous patent cliffs that primarily rewarded low-cost generic manufacturers, the next cycle is focused on large-molecule biologics, which are inherently more complex to develop, manufacture, and replicate. More than 60% of drugs losing exclusivity are large-molecule biologics, which is a structural shift from earlier patent cycles that were dominated by small-molecule drugs.
Shift to Complex Biologics
“Large molecules (biologics) are complex proteins produced in living cells, making biosimilars (generic versions of biologics) difficult to produce and scale. Biosimilars are highly similar to biologics but are not identical. Due to this complexity, biosimilars require significantly higher investment, longer development timelines, extensive testing and regulatory scrutiny,” the ratings agency said.
The report noted that while the generics segment works on drug affordability, the winners in the next phase will be determined by their time-to-market strategies. A significant proportion of drugs losing exclusivity are in chronic therapy areas like cancer, diabetes or neurological disorders where patients require continuous treatment over extended periods. In such categories, speed to market becomes critical as the first product to launch is likely to establish prescribing habits and patient initiation early in the treatment lifecycle. “Once patients are stabilised on a therapy, switching mid-treatment can raise concerns around efficacy, tolerance, or side effects, making both physicians and patients reluctant to change,” the report said.
According to CareEdge estimates, oncology alone accounts for about 35% of the upcoming patent expiry opportunity followed by immunology at 24%, while diabetes (10%), obesity (9%) and cardiometabolic (8%) therapies also account for a major share.
Overcoming Innovator Tactics
The report also cautioned that the innovator firms are not going to give up their market share easily. Innovator companies use various patent protection strategies like filing secondary patents, extending the timelines, strategic partnerships, pricing, brand migration, settlement with other generic players that further delay the entry of generic versions. For instance, the main patent for a drug called Humira expired in 2016. Still, biosimilar entry was delayed until 2023 due to various patent protection strategies adopted by the innovator company.
“In this context, India’s robust legal framework – which limits practices such as evergreening and provides safeguards against excessive patent barriers – combined with strong manufacturing and regulatory capabilities offers structural support to Indian generic and biosimilar companies in capturing this opportunity,” said Pritesh Rathi, associate director at CareEdge Ratings.