Generic Drug Market Continues Expansion
The generics industry is on a nonstop growth trend that has moved it from a $21-billion industry to a $40-billion one in the past 5 years, according to a report from the business intelligence firm Cutting Edge Information (CEI). As the most competitive market in the world, the US generic market is growing by leaps and bounds.
An FDA report released early in 2004 found that generic prescriptions in the United States cost dramatically less, compared with their illegally imported Canadian counterparts. FDA officials believe that both generic and brand name pharmaceutical companies must develop strategies to keep US prescriptions from getting into the hands of our neighbors to the north.
"In the age of generics, speed is the key to survival," said Jon Hess, senior analyst at CEI. On average, drug makers spend 12 years turning a patented compound into a marketable medication. That leaves only 7 years for the drug company to earn back its investment before the core compound's patent expires. Within 4 years, a significant portion of branded drug sales will be open to generic competition, as patents expire on blockbuster drugs, totaling >$80 billion.