Cart (0)
business newsThe Fall of Lipitor
By
Brett Chase
Apr 19, 2011 1:15 pm
Generic medicines are eating into big brand-name sales at a rapid pace. Days are numbered for Pfizer's top-seller.
PRINT
Not only are generic medicines taking US market share from big brand-name drugs, they’re doing it faster than ever.
Generics made up almost 80% of the total prescription market in the US last year, up from just more than 60% four years earlier. And pharmacists are dispensing generics at rapid-fire pace after branded drugs lose their patent protection.
Those facts, contained in a report by industry researcher IMS Health, paints a bleak picture for pharmaceutical companies that depend on brands. Adoption of generic equivalents of branded drugs is occurring at a much quicker pace in the US than just a few years ago. Within six months of a drug’s patent loss last year, generics captured more than 80% of a brand’s volume, IMS reports. In 2006, generics only took 55% of the prescription volume in a six-month post-patent period. The US is the largest and most important market for most of these drug makers.
Only three branded drugs were among the most-prescribed products in the US last year: cholesterol treatment Lipitor, the blood thinner Plavix and asthma medicine Singulair. The most prescribed drug in the US last year was the generic version of the narcotic Vicodin. The No. 2 most prescribed medicine was the generic Zocor cholesterol drug, followed by the high blood pressure treatment lisinopril.
As of last year, Lipitor remains the top-selling branded drug, hauling in $7.2 billion in 2010 (down from $7.6 billion in 2009) but that picture will change dramatically after Pfizer (PFE) gets generic competition for Lipitor later this year. Lipitor lost its US patent last year. Watson Pharmaceuticals (WPI) is expected to sell generic Lipitor beginning in November. Watson began selling a generic version in Canada last year.
Likewise, Bristol-Myers Squibb (BMY) and Sanofi-Aventis’ (SNY) Plavix will face generic competition next year for Plavix.
Plavix was the third biggest branded drug with $6.1 billion in sales last year, while Singulair was seventh with $4.1 billion in revenue, IMS reports. AstraZeneca’s (AZN) heartburn drug Nexium was the second-biggest brand with $6.3 billion in revenue last year. AstraZeneca has fought off patent challenges and has protection from generic rivals until at least 2014.
Merck’s (MRK) Singulair faces generic competition next year. Singulair was No. 25 among the US most prescribed drugs in 2010, while Plavix was 23rd and Lipitor was No. 12.
Overall, US spending on prescription drugs rose more than 2% to $307.4 billion last year. That was less than half the more than 5% growth rate in 2009, IMS reports.
“Last year, we saw the convergence of key dynamics leading to diminished growth in drug spending, which included the greater use of generics, loss of patent protection for major branded products, slower demand and less spending on new therapies,” IMS researcher Michael Kleinrock says in a statement.
A slower economy probably kept some patients from seeing their doctors last year, he adds.
Trade ETFs? Take a 14-Day Free Trial to Mike Paulenoff's MPTrader newsletter. Receive specific trades and strategies across all sectors. Learn more.
Generics made up almost 80% of the total prescription market in the US last year, up from just more than 60% four years earlier. And pharmacists are dispensing generics at rapid-fire pace after branded drugs lose their patent protection.
Those facts, contained in a report by industry researcher IMS Health, paints a bleak picture for pharmaceutical companies that depend on brands. Adoption of generic equivalents of branded drugs is occurring at a much quicker pace in the US than just a few years ago. Within six months of a drug’s patent loss last year, generics captured more than 80% of a brand’s volume, IMS reports. In 2006, generics only took 55% of the prescription volume in a six-month post-patent period. The US is the largest and most important market for most of these drug makers.
Only three branded drugs were among the most-prescribed products in the US last year: cholesterol treatment Lipitor, the blood thinner Plavix and asthma medicine Singulair. The most prescribed drug in the US last year was the generic version of the narcotic Vicodin. The No. 2 most prescribed medicine was the generic Zocor cholesterol drug, followed by the high blood pressure treatment lisinopril.As of last year, Lipitor remains the top-selling branded drug, hauling in $7.2 billion in 2010 (down from $7.6 billion in 2009) but that picture will change dramatically after Pfizer (PFE) gets generic competition for Lipitor later this year. Lipitor lost its US patent last year. Watson Pharmaceuticals (WPI) is expected to sell generic Lipitor beginning in November. Watson began selling a generic version in Canada last year.
Likewise, Bristol-Myers Squibb (BMY) and Sanofi-Aventis’ (SNY) Plavix will face generic competition next year for Plavix.
Plavix was the third biggest branded drug with $6.1 billion in sales last year, while Singulair was seventh with $4.1 billion in revenue, IMS reports. AstraZeneca’s (AZN) heartburn drug Nexium was the second-biggest brand with $6.3 billion in revenue last year. AstraZeneca has fought off patent challenges and has protection from generic rivals until at least 2014.
Merck’s (MRK) Singulair faces generic competition next year. Singulair was No. 25 among the US most prescribed drugs in 2010, while Plavix was 23rd and Lipitor was No. 12.Overall, US spending on prescription drugs rose more than 2% to $307.4 billion last year. That was less than half the more than 5% growth rate in 2009, IMS reports.
“Last year, we saw the convergence of key dynamics leading to diminished growth in drug spending, which included the greater use of generics, loss of patent protection for major branded products, slower demand and less spending on new therapies,” IMS researcher Michael Kleinrock says in a statement.
A slower economy probably kept some patients from seeing their doctors last year, he adds.
Trade ETFs? Take a 14-Day Free Trial to Mike Paulenoff's MPTrader newsletter. Receive specific trades and strategies across all sectors. Learn more.
No positions in stocks mentioned.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
