Generics bonanza: drug prices set to plummet as patents expire

Six main factors are having, and will have, a powerful bearing on thesize, growth and nature of the generic drugs industry and market, according to a joint-venture report by Reuters Business Insight and Datamonitor, entitled The Generics Outlook 2001. These are:

- patent expiries: one of the most powerful drivers for the generics industry over the next decade will be the number of highly-successful pharmaceutical brands that will become open to generic competition. The opening of the market to competition is set to result in dramatically-reduced prices (in some cases 20% of the original price) revealing how, for the last 20 years, leading drugmakers have kept prices artificially high, according to the report;

- consolidation: this will result from the strain placed on smaller generics producers by intense price competition, especially in Europe;