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Generic drugs are non branded medications that are addressed by their active pharmaceutical ingredient. These drugs have the same pharmacologic effects as that intended of their branded versions and therefore are safe to use. Generic drugs are generally inexpensive as the manufacturers do not require to invest in development and marketing costs that are to be done for branded drugs. Since patents lapse every decade or so, companies are incentivised to scale production and market their generic versions, which improves availability and affordability of generic. For instance, Humira is a patent with Abbvie. The expiry in 2016 have spiked generic copies such as Amjevita, Qletli, and Cyltezo. Recent developments in biologics and bio similar sector are also propelling the growth of global generic drugs market.
Moreover, new companies are entering into generic drugs production with an intention to gain significant market share. As a result, they are offering generic drugs with competitive pricing, thereby making generic even more affordable. For instance, Eylea and Stelara are specialty drugs which would be lapsing by 2025 to which companies have developed relevant biologics ready to launch in the segment. Growing prevalence of chronic diseases is expected to augment growth for generic drug market globally.
Some of the key drivers of generic drugs are prevalence of chronic diseases which has created a demand for affordable medication. Moreover, a lower price of generic drugs as compared to branded counterparts, is one of the key factors driving adoption of generic drugs in developing as well as developed economines. Moreover, the patent expiries of blockbuster drugs are influencing development of generic copies and anticipated to drive the market growth in near future. Also, new entrants in the generic drug and biosimilar drug market are offering cost effective and efficient generic versions of branded drugs which is also supporting the market growth.
Key Market Driver -
Growing prevalence of chronic diseases, Increasing patent expiries
Key Market Restraint -
Lack of awareness about generic drugs
Globally, the generic drugs market can be segmented on the basis of drug class, indication, distribution channel and region. Based on the drug class, the market can be segmented into antipyretics, antihistamines, analgesics, antibiotics, antihypertensive, antidiabetic and others. Based on indication, the market can be segmented into cardiology, diabetology, pulmonology, gastroenterology and others. Based on distribution channel, the market can be segmented into hospital pharmacies, retail pharmacies and online pharmacies. Geographically, the generic drugs market is segmented into North America, Europe, Asia Pacific, Latin America, Middle East and Africa.
Some of the major companies that are present in the generic drugs market are Viatris Inc., Teva Pharmaceutical Industries Ltd., Novartis AG, Viatris Inc., Fresenius kabi AG, Aurobindo pharma, Lupin, Aspen holdings, Amneal Pharmaceuticals LLC., other prominent players.
Geographically, the generic drugs market is segmented into North America, Europe, Asia pacific, Latin America, and the Middle East & Africa. North America leads the generic drugs market. According to the Commonwealth Fund, in 2018, the U.S. spent 16.9 percent of gross domestic product (GDP) on health care, the second-highest ranking country, Switzerland, spent 12.2 percent of the gross domestic product (GDP) on health care. Europe anticipates growth in the global generic drugs market due to government initiatives and advancement in healthcare which will promote market share of Europe on a global scale. For instance, European Medicines Agency (EMA) promotes generic drug applications along with hybrids for companies to market their versions. This will encourage more companies to introduce generic versions of branded drugs in the region. Asia pacific anticipated growth in generic drugs market due to rising prevalence of chronic diseases and favorable government initiatives for generic medicines which will reflect positively on market growth. According to a study by the Centre of Disease Control and Prevention of U.S. Department of Health & Human Services, in September 2020, 51.8% of total US adult patients had at least 1 of 10 selected diagnosed chronic conditions (arthritis, cancer, chronic obstructive pulmonary disease, coronary heart disease, current asthma, diabetes, hepatitis, hypertension, stroke, and weak or failing kidneys), and 27.2% of US adult patients had multiple chronic conditions. Rising prevalence of such chronic ailments are subject to increase in treatment rates thereby increasing demand for the generic drugs market. Latin America is anticipated to show significant growth in the generic drugs market. Healthcare expenditure and need for sustainable healthcare are some factors that will affect growth positively. For instance, in March 2021, Biocon launched its generic drugs in Brazil in a partnership with Libbs Farmaceutica. This partnership will improve the market size and make these generic drugs accessible and affordable. Middle East & Africa are expected to showcase substantial growth due to rise in awareness and increase in healthcare expenditure during the forecast period.
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