Indian generics profit from Glaxo patent expiry

GlaxoSmithKline Plc’s anti-migraine drug brand, Imitrex, is turning out to be a good revenue earner for Indian generic companies, as the US Food and Drug Administration (FDA) has given almost half of the final approvals for the reverse engineered or generic versions of the drug made by Indian pharmaceutical companies, following its patent expiry.

The final approvals for generic versions of the drug, named sumatriptan succinate tablets, are for Indian companies such as Orchid Healthcare, Aurobindo Pharma, Sun Pharmaceuticals, Ranbaxy Laboratories and Dr Reddy’s Laboratories in different versions of the tablet, with dosages of 25 mg, 50 mg and 100 mg. The other approvals from the FDA last week were for overseas drug companies like Hikma Pharma, Mylan, Sandoz, Roxane and Cobalt.

Analysts said with more than a dozen players in the market, each of these companies are unlikely to get more than $5-10 million from sale of Imitrex generics, due to competition causing price erosion.

Annual sales for Imitrex were approximately $1 billion in the United States for the 12 months that ended December 31, 2008, based on IMS sales data. GSK has already launched an improved version of the migraine drug, Trexima, and is switching patients using Imitrex to the new drug. The 100 mg strength tablets have sales of more than $650 million. The 25 mg and 50 mg strength of the drug has a market of around $350 million per annum in the US.

“Apart from the authorised generics of Dr Reddy’s, Teva and the 100 mg tablet for Ranbaxy, the upside will be limited due to competition. These companies have gained during the six-month period and now the market is open for all,” said Ranjit Kapadia, vice president for institutional research at HDFC Securities.

Dr Reddy’s Laboratories, which entered into an out of court settlement with GSK on the patent challenge litigation of this drug, has already netted over Rs 200 crore in the first quarter of 2009-10 as an authorised generic, cornering about 50 per cent of the US generic market for Imitrex, said company sources.

As per the US rules for selling generics drugs, the first to challenge an innovator patent gets 180 days of exclusive sales in the US market upon patent expiry. Of late, innovator companies assign or launch own authorised generic versions to protect their sales during patent expiry and to reduce the upside the exclusivity holder gets from 180 day sales.

Israel-based Teva, one of the first to challenge the patent of this drug, sells it since February and its product is available in the US market at almost four per cent of the branded product’s price, said sources.

Ranbaxy, another company which first challenged the patent of Imitrex, could not launch the drug when the patent expired in February, as the FDA delayed final approval. The Daiichi Sankyo-controlled firm is facing charges of data manipulation and failure to meet US FDA manufacturing standards at two of its Indian facilities. Ranbaxy had earlier got final approval to launch a 100 mg version of the tablet and its product is available in the US market.