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Generic producers line up as Viagra patent expires
(chinadaily.com.cn)
Updated: 2014-11-07

By the time Chinese patent rights for Viagra expired last May, nearly 20 domestic medicine companies had already lined up with applications to the national food and drug administration for production of generic versions.

Guangzhou Baiyuanshan Pharmaceutical Holdings Co is the first to be given the green light.

The company announced at a press conference on Sept 18 that it will start selling generic sildenafil citrate - the active ingredient in Viagra - in late October.

Viagra was originally developed to fight heart attacks but instead found its most widespread use in treating erectile dysfunction.

US pharmaceutical giant Pfizer sold some 300 million doses of Viagra worldwide by 2013. The company applied for the patent in China in 1994 and was granted 20-year exclusive rights in 2001. Data from healthcare market research firm IMS Health shows that Viagra generated more than 1 billion yuan ($163.5 million) in sales and captured 58.8 percent of the market in 58 major Chinese cities last year.

Its main competitors are Cialis from Eli Lilly and Co, with 34.6 percent, and Levitra made by Bayer AG, with 6.6 percent.

There are about 140 million patients with erectile dysfunction in China, according to a report released by Guosen Securities in May.

And though its exclusive patent has expired, Pfizer has no plans to stop making the ground-breaking drug. "Patent expiration is not the end of a product," Xi Qing, director of communication at Pfizer China, told Beijing Times.

Viagra's patent expiration will not have an immediate effect on the company's business in China, said Xi.

And the company even plans to maintain the same pricing, he said. "Given the market performance of other patent-expired medicines, we remain optimistic about future sales."

Yet industry insiders said six months after generic drugs come onto the market, their prices generally drop to around 20 percent of the initial brands and sales of the original tend to fall 70 percent - a phenomenon known as the "patent cliff", Legal Weekly reports.

Cheaper Chinese substitutes will certainly find a niche in second and third-tier cities, analysts said. Yet a generic drug is not simply a copy. It also requires research and development that is likely to take years. The required technical criteria are also as stringent as for the previously patented medicine.

"It's very hard in practice. The original developer won't reveal its technical skills or production procedures," Zhou Qing, chief science officer of Genor Biopharma Co Ltd, told China Economics and Information magazine.

Development of a generic drug is "like exploring in a dark house laden with obstacles", said Zhou, whose company is mainly involved in developing anti-tumor medicines.

The search also requires innovation to gain a better edge in costs, he added.

Zhang Chenghai, vice-president of a bio-tech research center at CP Guojian Pharm, told the magazine he is concerned about prolonged approval periods for generic drugs in China.

"The administrative approval procedures for generic drugs is almost the same as those for a new medicine and even more complicated as it has the additional burden of making a contrast with the original drug," Zhang said.

More than 600 types of medicines are due for patent expiration by the end of 2015. A report by Merchants Securities predicted that the domestic market for generic drugs will be close to 500 billion yuan in 2015.

The enormous market potential is a draw for not only Chinese pharmaceutical companies but also multinationals.

Statistics from the pharmaceutical research and development commission at the China Association of Enterprises with Foreign Investment shows that 70 percent of its membership has established production facilities in the country and make generic drugs.

Big names include industry giants such as AstraZeneca and Novartis.

(Source: China Daily)



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