The global generic drugs market comprises drugs with the same active pharmaceutical ingredient and therapeutic effect as their branded counterparts, but are significantly lower in cost. Generic drugs offer more affordable treatment options and serve as an important alternative to patented brand-name drugs nearing the end of their exclusivity period. Generic manufacturers introduce these drugs with the goal to provide patients accessibility to medicine. The global generic drugs market encompasses a variety of therapeutic categories including Central Nervous System (CNS), Cardiovascular, Dermatology, Genitourinary/Hormonal, Respiratory, Rheumatology, Diabetes, Oncology and others. Generic drugs enable healthcare providers to treat more patients at a lower overall cost by reducing the amount spent on medicines.
The global generic drugs market is estimated to be valued at US$ 439.37 bn in 2023 and is expected to exhibit a CAGR of 5.4% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics:
The global generic drugs market is expected to witness high growth owing to the introduction of novel polymorphs of existing drugs going off-patent. Polymorphism refers to the ability of a drug substance to exist in two or more crystalline phases that have different arrangements and conformations of the molecules in the crystal lattice. Pharmaceutical companies introduce novel polymorphic forms of popular drugs nearing the end of their exclusivity period to extend their patent protection. For example, Mylan recently launched a novel polymorph of the mega-blockbuster drug Revlimid (lenalidomide) and in doing so, extended its market exclusivity by six months. Introduction of polymorphs provides branded drug manufacturers a strategy to block early generic competition and regain market share lost to generics. Additionally, rising healthcare expenditure in developing nations driven by rapidly aging populations and growing middle class is a key factor increasing access and demand for lower-cost generic equivalents. Furthermore, government policies promoting the use of generics to cut drug costs while improving population health is also expected to support growth over the forecast period.
Market Dynamics:
The global generic drugs market is driven by rising healthcare costs in developing countries as a result of growing geriatric populations and increasing prevalence of chronic diseases. This has led governments worldwide to implement reforms supporting the use of lower-cost generics as a means to expand access and reduce overall
SWOT Analysis
Strength:
Lower costs compared to brand-name drugs allow greater affordability and accessibility for patients. Generic drugs often sell at prices 50% to 80% lower than their brand-name equivalents.
Huge patient pool suffering from chronic diseases provides continuous market demand. Generic drugs help patients continue their treatment economically.
Presence of well-established generic drug supply chains and manufacturing infrastructure helps meet the scale of demand from a large patient base.
Weakness:
New generic drug approvals face regulatory hurdles and patent litigation from innovator companies, delaying market entry. This affects the ability to quickly benefit from patent expiries of blockbuster drugs.
Significant price erosion occurs as more generic versions enter the market, pressuring profits of early generic market entrants.
Opportunity:
Major drugs going off-patent in the coming years with collective sales of over $200 billion provide significant market potential for generics. This includes drugs for diabetes, cancer, asthma and cardiovascular diseases among others.
Emerging markets in Asia Pacific and Latin America offer headroom for volume growth due to increasing healthcare spending and focus on affordable drugs.
Threats:
Prices of major commoditized generics bottoming out limits room for expansion. Margins stay under pressure from intensifying competition.
Regulatory compliance issues and recalls due to quality concerns dent companies' reputation and financials.
Key Takeaways
The global generic drugs market is expected to witness high growth over the forecast period supported by rising healthcare spending in developing nations and faster adoption of generics worldwide. A majority of revenue is generated from chronic therapy area including cardiovascular drugs, central nervous system drugs and anti-infective medications. Further accelerated uptake of affordable generic alternatives to biologics termed as biosimilars is projected to boost the market opportunities.
The global generic drugs market is estimated to be valued at US$ 439.37 bn in 2023 and is expected to exhibit a CAGR of 5.4% over the forecast period 2023 to 2030.
Regional analysis related content comprises: North America accounts for the largest share currently due to favorable policies encouraging generic drugs. However, Asia Pacific is poised to witness fastest growth aided by large patient population, focus on primary healthcare and increasing health insurance penetration in countries like India and China.
Key players related content comprises: Key players operating in the generic drugs market are Mylan N.V., Novartis International AG, Pfizer, Inc., Allergan Plc, Sun Pharmaceuticals, Fresenius Kabi, Sanofi, Endo International, Lupin Ltd., Abbott Healthcare, AstraZeneca Plc, and Novo Nordisk. Larger players enjoy scale benefits while mid-size companies focus on niche segments and complex generics. Partnerships and M&A remain common for portfolio expansion.
