Thomson Reuters classifies potential future active pharmaceutical ingredient (API) suppliers as companies that, as they develop could establish themselves in regulated markets. In this category China has the most companies, followed by India and the rest of the world.
In contrast, India has more companies than China in the category for more advanced API suppliers, called 'less established' by Thomson Reuters. This implies a more mature API market and this is reflected by data for DMFs from India over the past decade.
Speaking at CPhI 2010, David Harding, from Thomson Reuters, presented data showing growth of drug master files (DMFs) submitted by India in the 2000s was considerably quicker than from China. Furthermore, India has now overtaken the US in European COS (Certificate of Suitability) after experiencing a rapid increase from 2007 onwards.
Globalisation of API supply has been accompanied by increases in overseas inspections by the US Food and Drug Administration (FDA). Harding said overseas inspections have increased steadily over the past decade this is expected to continue because of the establishment of FDA offices outside the US.
Data from Thomson Reuters lists: 1484 local API manufacturers, those serving local or unregulated markets; 293 potential future; 226 less established; and 160 established. Most established companies are in traditional markets but emerging regions, such as China and India, possess more growth potential.
Harding said securing early access to a viable API source is key to succeeding in the generic market. Thomson Reuters values the global generics market at $150bn (€107bn) and the total pharmaceutical market at $710bn. Much of the growth seen in the generics market has come from non-traditional markets.
As the market has grown, so have the number and value of mergers and acquisitions (M&A), although both measurements dropped in 2009. Partially as a consequence of M&A activity only four of the top 10 generic companies in 2001 were still in the leading pack in 2009.
For the remaining companies biosimilars represent the next growth opportunity. Harding said biologics with revenues of $32bn are due to come off patent by 2019. However, even with the adoption of legislation in the US, and the expectation other markets will follow its lead, it will be tough to enter the biosimilar market.
To succeed in this higher barrier to entry market companies will need to make significant investment, in production, clinical trials and post-marketing surveillance, understand regulations and take a sophisticated approach to product selection, said Harding.