Drugmakers face $140 bln patent "cliff" -report

By Staff
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Google Oneindia News

LONDON, May 2 (Reuters) The world's top drugmakers face the loss of 0 billion in annual sales by 2016 as key product patents expire and cheap generic versions of their blockbuster medicines hit the market, according to a report on Wednesday.

Independent market analysis firm Datamonitor said that the huge patent ''cliff'' meant manufacturers of branded products could expect to face a decade of unrelenting generic competition.

Several companies are already feeling the heat, but industry analysts -- who have long warned of a looming sales drop -- say it will reach a crescendo around 2011/2012, when many lose patent protection on their largest or second-largest products.

Medicines coming off patent in the pivotal U.S. market in those two years alone include Pfizer Inc.'s Lipitor, GlaxoSmithKline Plc's Advair, AstraZeneca Plc's Seroquel, and Sanofi-Aventis and Bristol-Myers Co.'s Plavix.

The loss of 0 billion in revenues will take a large bite out of a global business that raked in sales of 3 billion last year, based on figures compiled by IMS Health.

As a result, many investors are concerned drug companies do not have enough new compounds moving through development to keep sales and profits growing at historic levels.

Those anxieties have been heightened recently by a number of high-profile failures of new medicines, such as Pfizer's torcetrapib, which was supposed to take over from cholesterol fighter Lipitor but failed in a pivotal trial last year.

Datamonitor noted that many companies were working on new, improved formulations of threatened drugs in the hope that novel drug delivery mechanisms could give a new lease of life to products.

One favourite approach is to produce long-lasting tablets.

But such life-cycle management is only a stop-gap, according to Datamonitor senior pharmaceutical analyst Alistair Sinclair.

''While reformulation strategies may be effective at staving off generic competition in the short term, ultimately manufacturers need to develop truly novel drugs in order to maintain franchise and portfolio revenues in the face of generic competition,'' he said.

REUTERS DH BST0438

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