News | News By Subject | News by Disease News By Date | Search News
Get Our FREE
Industry eNewsletter
email:    
   

GlobalData Release: Which Strategies Can Big Pharmaceutical Companies Use to Manage the Impact of Patent Protection Loss?



7/5/2012 9:37:18 AM

LONDON, UK (GlobalData), 5 July 2012 - Exclusivity is everything in the pharmaceutical brand business. Without it, power over pricing disappears and sales evaporate, leaving drug makers helpless – but can this fate be avoided, asks a new report by healthcare experts GlobalData.

The new report considers the looming challenge faced by pharma giants, namely patent protection losses. Big pharmaceutical companies must either prepare to submit to revenue losses, or adopt methods of managing the impact of brand patent expiry. Strengthening of drug development pipelines, opportune product launches and cost saving initiatives may hold the key to surviving patent losses.

While the birth of a blockbuster drug brings new income and energy to a company, the drug’s patent loss causes revenue to drop, leaving the company’s financial situation to suffer. Over the next five years, the global pharmaceutical industry will face a $140 billion invasion of generic drugs due to patent protection losses, as in 2011 and 2012 alone, the US is due to see major brands worth $40 billion lose patent protection.

A sizeable portion of a pharma company’s revenue evaporates when a product loses patent protection, as cheap generic copies flood the market. Within a few weeks there is an approximate 70%–75% switch from branded product to generic equivalent, motivated by an 80%–85% reduction in price. This results in disaster for the jilted brand, and therefore strategies to offset these losses are essential.

Over time, the pharmaceutical industry has adopted strategies to generate the “evergreen” concept, in which a brand can continue its market performance indefinitely. In reality, no brand can provide revenue forever, but GlobalData has analysed the strategies most usually adopted by the industry which pave a way for revenue to be extended. These strategies include the development of formulation improvements, which allow a basic drug formula to be remarketed as a unique product. The ‘chiral switch’ is one strategy that pharmaceutical companies adopt, inventing ‘chiral compounds’ which are mirror images of existing drugs, exhibiting similar chemical properties, but performing significantly different biological activities.

Existing medications can also be improved upon by developing once daily, or extended-release formulations. Alternatively, product extensions can use the drug to treat different indications. Lastly, moving a drug within the consumer marketplace from prescription (Rx) to Over-the-Counter (OTC) status allows companies to direct products going off-patent to more accessible use, spurring sales.

Such methods of brand promotion must be used and perfected in order for pharma giants to survive the incoming influx of generic medications, as the loss of patent protection forces the industry to step up the competition.

*Which Strategies can Big Pharmaceutical Companies Use to Manage the Impact of Patent Protection Loss?

This viewpoint is an essential source of information and analysis on the patent protection strategies by Big Pharma along with case studies. It provides insights on the companies as well as products that were launched to minimise the impact of loss of patent protection, and most importantly provides valuable insights on the analytical and quantitative aspects of patent protection-off impact.

This report is built using data and information sourced from proprietary databases, primary and secondary research, and in-house analysis by GlobalData’s team of industry experts.

-ABOUT GLOBALDATA-

GlobalData is a leading global business intelligence provider offering advanced analytics to help clients make better, more informed decisions every day. Our research and analysis is based on the expert knowledge of over 700 qualified business analysts and 25,000 interviews conducted with industry insiders every year, enabling us to offer the most relevant, reliable and actionable strategic business intelligence available for a wide range of industries.

For more information, please contact our Press Office on +44 (0)1204 543 537 or at pr@globaldata.com


Read at BioSpace.com


comments powered by Disqus
 
 

ADD TO DEL.ICIO.US    ADD TO DIGG    ADD TO FURL    ADD TO STUMBLEUPON    ADD TO TECHNORATI FAVORITES