SOURCE: Cutting Edge Information

November 07, 2007 07:27 ET

Playing Both Sides: Drug Companies Launch Their Own Generics

RESEARCH TRIANGLE PARK, NC--(Marketwire - November 7, 2007) - Branded drug makers plan to increase authorized generics launches through the end of the decade, according to a new study by Cutting Edge Information (

To market an authorized generic, branded pharmaceutical companies license other drug distributors -- which may be in-house or external firms -- to sell generic versions of brand-name drugs. The practice helps companies continue to make money after brands lose patent protection and generic competition forces prices to drop.

Among the companies surveyed by Cutting Edge Information, authorized generics are growing in popularity as more organizations seek to retain critical drug revenues. In comparison to the recent past, almost 75% more of these companies plan to launch authorized generics by 2010 -- all through company-owned generic subsidiaries. The same group of companies also plans to increase its use of external generics distributors by more than 30%.

These tactics are among the fastest-growing techniques used by brand companies to maintain revenue in the face of generic competition.

"Authorized generics now commonly appear for brands going off patent," said Eric Bolesh, research team leader at Cutting Edge Information. "The increase in corporate-owned generics subsidiaries is especially notable. Companies are less comfortable handing revenue to external generics companies who are often also the competition, so they turn to in-house groups for distribution."

Cutting Edge Information's report, "Combating Generics 2008: Counter Generics Strategy, Planning and Execution," available at, found that while 11% of companies have attempted to release generics through corporate-owned subsidiaries, 19% plan on using this strategy between 2008 and 2010 -- an increase of 73%. Due to resource needs, generic subsidiaries have typically been limited to only the biggest industry players. Other drug companies are now exploring this territory, however, as patent expirations near.

"Combating Generics 2008: Counter Generics Strategy, Tactics and Execution" examines counter-generics activity at more than 30 different companies. Data detail investment levels, planning and implementation timelines and the prominence of different tools and tactics in the fight against generics. The report's findings also explore case studies and the experiences of real-world brand teams.

Download a free summary of this 159-page report at:

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