Innovator drugs maintain market hold even after patent expiry, shows data

Merck's anti-diabetic molecule sitagliptin retains 81% market share in value terms

Amid a slew of drugs going off patent, US pharmaceutical major Merck, along with its partners, has managed to retain an 81 per cent market share in value terms for its anti-diabetic molecule sitagliptin in the Indian market, according to data from market research firm AWACS.

New launch activity by generic players, too, has slowed, the data showed. In November, there was no generic brand launch in sitagliptin or the sitagliptin-metformin combination. The brand went off patent around July.

Sheetal Sapale, president (marketing), AWACS, said, “[There has been] a significant decline in new launch activity in the last two months. Though several brands have entered the sitagliptin generic market, it is 12 brands that contribute 80–90 per cent to the value market.”

In terms of volume, lower-priced generic brands managed to garner a 24 per cent market share in sitagliptin by November, and a 14 per cent share in the sitagliptin-metformin combination market.

The innovator brand from Merck was priced around Rs 40 per tablet. Glenmark was the first to launch a generic version of sitagliptin, priced at Rs 10-20 per tablet.

A senior executive of a Mumbai-based firm, who is heading the cardio-diabetic division of his firm, said on condition of anonymity, “In chronic therapies, patients often don’t change brands. When a patent goes off, the innovator brand also reduces prices, but it usually maintains a premium over generic brands.”

For brands that enter later, their only point of differentiation is pricing, he said. “There is also a limit to how competitively one can price. Therefore, after an instant 50-60 per cent price erosion, this arrests itself. These new brands have to consolidate themselves in the market through marketing activities, etc, which takes time. Thus, the innovator and its partners continue to enjoy a value market share,” he explained.

However, after a patent expiry, the volume of the market expands significantly. For example, there was a volume growth of over 50 per cent in July over June for sitagliptin, while the value growth was around 14 per cent. More doctors prescribe the drug as it becomes affordable.

Now, another key cardiac drug from Novartis is set to go off patent in January –- sacubitril-valsartan, which the firm markets under the Vymada brand.

Already, JB Pharmaceuticals, which has an authorised generic, has slashed prices of its brand, Azmarda, by 50 per cent this week.

Sapale estimates that about 40 companies may enter this attractive market at 50-75 per cent of the current price. “The drug has strong scientific data on heart failure; there is almost a 20 per cent reduction in hospitalisation,” she said. Therefore, there is interest among generic drug makers to garner a share of this Rs 500 crore market, which is clocking a 30 per cent CAGR (compound annual growth rate). 

Merck's antidiabetic drug went off patent in July 2022

-	Sub-Group	Market share of Innovator, partners	Market share of top 10 generics
Value	Sitagliptin	81%	10%
	Sitagliptin-Metformin	80%	11%
Quantity	Sitagliptin	55%	24%
	Sitagliptin-Metformin	74%	14%