Datamonitor: Patent cliff for epilepsy and reputation issues for generic CV drugs

With past and patent-protected current drugs facing challenges, the markets are in flux

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NEW YORK—Recently, independent market analyst Datamonitor has been thinking about the epilepsy and cardiovascular (CV) disease markets, and in both cases, the issues of patents and generics are looming large.

In the case of epilepsy, it's the "patent cliff" that is most notable, in the sense that despite the upcoming launch of several new brands, Datamonitor expects the epilepsy market to recover slowly from the 2008 and 2009 patent cliff in the United States, though the market should reach almost $5 billion by 2019.

With CV drugs and metabolic drugs closely tied to CV disease, Datamonitor is eyeing the generic aspect more specifically, and wonders if generic drugmakers may soon face a reputation problem.
Starting with epilepsy, though, the strongest growth in that market is expected to come from Japan, where Datamonitor expects the market to double in value to around $430 million by 2019, aided by uptake of second-generation antiepileptic drugs. This equates to a compound annual growth rate (CAGR) of 7.1%. The five major European markets will withstand the impact of Keppra's expiry, with a CAGR of 3.7% out to 2019, when the market value is forecast to be $1.5 billion.
In the United States, however, it will be 2016 before the market returns to pre-patent cliff values of $3 billion, with Lyrica, Vimpat and pipeline compounds all contributing to the recovery. This will be followed by a slight decline to $2.9 billion in 2019; providing a CAGR of 2.7% over the forecast period.
Daniel Chancellor, healthcare analyst at Datamonitor, comments: "Several late-stage pipeline drugs are set to launch and perform well commercially over the next three years, however excitement about their potential benefit is dampened by skepticism among experts in the field, who are waiting for a truly antiepileptogenic treatment to satisfy key unmet needs in epilepsy."
Of the pipeline antiepileptic drugs, Datamonitor expects Stedesa and Rikelta to become the most commercially successful, both achieving peak annual sales of over $350 million during the 10-year forecast period.
"Despite the wide array of approved treatments, several unmet needs still exist that continue to entice pharmaceutical companies into developing the next generation of epilepsy therapies. However, given the heterogeneity of epilepsy, the current treatment paradigm and saturation of the market, any company hoping to produce a drug that emulates the commercial success of Keppra will likely be disappointed," Chancellor concludes.

Datamonitor has predicted that the Cardiovascular and Metabolic generic market will be twice the size of the branded market by 2018 by volume, and account for 20% of the seven major market revenues. However, increasing competition and lower profit margins could lead to quality control issues that threaten generic reputation and growth.
Looking at the CV market and strongly related areas, Datamonitor predicts that the cardiovascular and metabolic generic market will be twice the size of the branded market by 2018 by volume; however, increasing competition and lower profit margins could lead to quality control issues that threaten generic reputation and growth.
Datamonitor suggests that while hypertension is the largest market and will continue to strengthen, dyslipidemia is the disease area that will show the highest generic growth over 2008 to 2018 in the seven major world markets.
Recent patent expiries in dyslipidemia have already stimulated strong generic sales and the upcoming generalization of the blockbusters Lipitor and Crestor in the statin class will ensure continued growth.
In other areas, thrombosis generics will see impressive progress once the patent protection for Plavix comes to an end in the United States. Diabetes generics will see slow growth and obesity drugs, which lack any major sellers, will remain a niche market.

"As the market becomes more generalized, the average price of generics drops and more patients choose to, or are able to, purchase cardiovascular drugs," notes Gideon Heap, healthcare analyst at Datamonitor. "Generic manufacturers sizing their potential market should be aware they are competing not just for the population currently taking a drug, but potentially others who only have access to lower priced drugs."

However, a fiercely competitive environment between generic manufacturers is compelling them to cut manufacturing costs, Datamonitor points out, noting for example that despite a volume growth of 10 percent in the 2007 to 2008 period, cardiovascular and metabolic generics revenues shrunk by 9 percent in the same period.
"A rather worrying consequence of these cost-cutting measures is the effect on quality control and safety standards," Gideon concludes, suggesting that this could be the biggest threat to continued generic success.

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