`
`News and Press Release | Press Release
`
`Indian staple makes sense here, find drug MNCs
`October 4, 2010
`
`Business Standard
`
`Branded generics route makes sense, they find, even as they invest in marketing reach.
`
`Foreign drug companies, expected to stage a comeback in the domestic pharmaceutical business with high-
`priced innovative medicines, are finding the staple business of local generic drug counterparts more attractive in
`Indian conditions.
`
`Almost all of them, whether names such as Pfizer, Novartis, GlaxoSmithKline or others, are looking for a share
`in the home-grown generics' business model — the revenues from sale of low-priced branded generics.
`
`Branded generics are medicines equally effective as the original patented molecules but made through different
`routes and sold at a much lower cost, under various names.
`
`The Indian model for foreign drug majors is expected to continue for a long time, as experts predict the share of
`patented medicines to remain abysmally low at two-three per cent in the foreseeable future.
`
`"Patented products form a small portion of the Indian market and even by 2020, will be less than one per
`cent. Branded generics constitute more than 90 per cent of the Indian pharmaceutical market. We are
`expanding our branded generics portfolio to therapies relevant to India," said Pfizer India's managing
`director, Kewal Handa. Pfizer had launched eight branded generic drugs during the past year, he added.
`
`Size spells opportunity
`
`Emerging markets are expected to achieve a size of $400 billion by 2020, with the Indian market expected to
`grow to a size of $40 bn (Rs 1.8 lakh crore) by then, an Icra analysis says.
`
`The projection explains the rationale behind the acquisition of Piramal Healthcare's branded generic business
`by US drug company Abbott, for $3.7 bn, early this year. It also tells why Japanese drug maker Daiichi Sankyo
`was eager to acquire majority shares of India's largest drug maker, Ranbaxy, for $4.6 bn two years earlier. For
`the same reason, ownership of companies such as Dabur Pharma, Matrix Laboratories and Shanta Biotech
`changed hands in the recent past..
`
`"Pharma MNCs are currently launching branded generics in the Indian market via product localisation, a
`strategy that involves local branding, sourcing and pricing. This strategy helps them launch products at
`competitive prices, thereby addressing affordability issues. With localisation, the pharma MNCs operating in
`India have been able to improve their growth rates and this strategy is expected to yield future growth," the Icra
`study said.
`
`Ranjit Shahani, vice chairman & managing director, Novartis India Ltd, said branded generics would continue
`to dominate the Indian market and would account for over 90 per cent of domestic drug business even in 2020.
`Novartis, a long-term player in the domestic drug business as compared to majors such as Daiichi Sankyo or
`US-based Merck, have been introducing several branded generic products in recent years, he said.
`
`One of two legs
`
`Exhibit 1121
`IPR2017-00807
`ARGENTUM
`However, the branded generic focus does not mean a reversal of their global strategy. According to the Icra
`analysis, most of these companies have a two-pronged strategy for India: To target the mass market via product
`
`http://www.pfizerindia.com/eNewsWebsite/news_website.aspx?news_id=U6XYvIzVAMU=
`
`1/2
`
`000001
`
`
`
`News and Press Release | Press Release
`2/13/2018
`localisation and India-specific pricing, and launch globally patented products in niche segments at a premium.
`"GlaxoSmithKline, for instance, has launched branded generics like Benitec A (Olmesartan, in combination
`with Amilodipine) in the cardiology segment, Meropenem in the antibiotic segment, and Calamine lotion in
`dermatology. Similarly, Pfizer has come out with 'branded value offerings' (branded generics) like Telmisartan
`and Rabeprazole in the therapeutic segments of cardiovascular management and gastrointestinal, respectively,"
`the study says.
`
`Sujay Shetty of global consultancy firm PricewaterhouseCoopers agrees. "Except for a few companies like
`Roche, that specialises in a few areas, all other foreign multinationals are looking at India's branded generics
`market. Branded generics consist of 98 per cent of the current portfolio of drugs sold here. There will be no
`change in this composition for the next 10 years," he said. He also said all multinational firms operating in the
`country were strengthening their marketing, to spread wide and deep here.
`
`"Leading companies such as GSK, Pfizer and Abbott have invested significantly in expanding their field force
`to widen the reach of both their current products and the ones in their pipeline. Pfizer added 500 people to its
`field force in 2009, while Merck Ltd had added 450 in 2008. Some pharma MNCs have also outsourced their
`sales and marketing function in remote rural areas to third parties, given that it is not cost-effective for them to
`have their own field force in such locations," Icra said.
`
`The experts also feel it is too early to predict that the increased presence of foreign drug firms in the same
`business spectrum is hurting Indian players.
`
`"The market has huge potential. Many parts of semi-urban and rural areas of the country are still left out. There
`is enough space for all players," Shetty said.
`
`http://www.pfizerindia.com/eNewsWebsite/news_website.aspx?news_id=U6XYvIzVAMU=
`
`2/2
`
`000002
`
`