The Changing Competitive Landscape in the Global Generics Market: Threat or Opportunity?

Abstract

The generics sector is going through a period of significant change. Following a period of record patent expiries starting at the end of the previous decade, the sector is forecast to face a slowdown in growth after 2006. Key factors driving change in the competitive landscape of the industry include the large number of new entrants from India, the impact of brand defence strategies such as authorised generics, the increasing importance of vertical integration, and continued consolidation creating industry giants unmatched in scale and scope. As a result, generics companies are facing increasing pressure on price, market share and profitability. Generics companies are using mergers and acquisitions to counter these pressures. Various strategies are identified including building scale, expanding into niche formulations, vertical integration and building brand businesses.