Generics Firms Under Pressure In 1st Qtr

4 May 1997

Despite hopes that competition in the US generic drugs industry wouldabate, it looks like it is still pretty brutal, according to Mike Krensavage of Oppenheimer. The industry is expected to report a downturn in earnings in the first quarter of 1997.

Generic prices fell around 20% last year, and dropped another 10%-12% in the quarter, according to Hemant Shah of HKS & Co, who finally sees a bottoming out some time this year. Mr Shah is begining to recommend generic stocks for two reasons. They are cheap now, he notes, and the inventory level of generics is the lowest it has been in the last three years. If the levels go down even further, it will take the pressure off pricing, he says. If the industry doesn't have to go out and sell aggressively, pricing will become more stable.

Mr Shah feels the bottom will come towards the end of this year or the beginning of next year. Anyone looking to invest in the generics sector now almost has to buy across the board, he adds.

This article is accessible to registered users, to continue reading please register for free.  A free trial will give you access to exclusive features, interviews, round-ups and commentary from the sharpest minds in the pharmaceutical and biotechnology space for a week. If you are already a registered user please login. If your trial has come to an end, you can subscribe here.

Login to your account

Become a subscriber

 

£820

Or £77 per month

Subscribe Now
  • Unfettered access to industry-leading news, commentary and analysis in pharma and biotech.
  • Updates from clinical trials, conferences, M&A, licensing, financing, regulation, patents & legal, executive appointments, commercial strategy and financial results.
  • Daily roundup of key events in pharma and biotech.
  • Monthly in-depth briefings on Boardroom appointments and M&A news.
  • Choose from a cost-effective annual package or a flexible monthly subscription
The Pharma Letter is an extremely useful and valuable Life Sciences service that brings together a daily update on performance people and products. It’s part of the key information for keeping me informed

Chairman, Sanofi Aventis UK





Today's issue

Company Spotlight