On August 25, 2020, Lupin announced that the company had received approval from the USFDA for gProAir HFA (Albuterol Sulfate Inhalation Aerosol). The approval is in line with management’s guidance during its Q1FY21 post-earnings conference call. The launch is expected in September. The approval comes after Perrigo’s 180-day exclusivity period.
The Albuterol HFA market comprises three brands: ProAir, Ventolin and Proventil. Lupin’s ANDA refers to ProAir HFA. Though the brands are different, we believe that the market is substitutable to a large extent, as almost 40% of prescriptions are written by molecule name. We estimate that the market size for all the brands put together is ~$1.1billion as of CY19. However, in the recent past, the market size expanded due to higher demand owing to the Covid-19 pandemic. We note that in 1HCY20, unit demand increased 13% YoY.
All three brands launched authorised generics in 2019. The USFDA also approved the first generic of ProAir in February (Perrigo’s ANDA) and Proventil in April (CIPLA’s ANDA). Therefore, along with authorised generics, there are five generics in the market currently. Despite generic competition, the pricing is attractive, in our assessment, and the market size at the manufacturer level is attractive at above $1 billion. High product complexity, greater demand due to Covid-19 and expectation of limited generic competition have led to lower than typical generic price erosion, in our view. We expect these factors to remain in place and hence expect pricing environment to remain stable.
ProAir, Ventolin and Proventil, along with respective generics accounted for 47.0%, 43.9% and 9.1%, respectively, as of June. Perrigo and Cipla launched their generic products in February and April, respectively, and had gained 12.3% and 2.6% of unit market share, respectively, as of June of the entire Albuterol HFA market. Teva is the largest player with ~34% market share as of June, including both brand and authorised generics. Teva reported brand sales of $66 million during the quarter ending June, with 10-15% market share. Perrigo reported sales of $70 million for the quarter ending June with market share of ~13%. These indicate the current market size of $1.5-2.0 billion, which could be on account of higher demand and inventory build-up due to Covid-19, which we expect to normalise in the coming quarters.