“Consolidation in the Generic Pharmaceutical Industry: An evolving landscape” pinpoints Ratiopharm, Stada and Actavis, all European-based companies, as those being the most likely to pursue further strategic acquisitions. It finds that there is considerable scope for further consolidation, especially in Central and Eastern Europe, with Zentiva, Krka and Gedeon Richter, all being fairly vulnerable targets.
Current market leaders are Israel’s Teva and Swiss-headquartered Novartis’ generics division Sandoz, both of which generated revenues in excess of $6bn from generics in 2006. “These two companies have pursued an aggressive acquisition strategy vying with each other for market leadership in the sector,” says Dr P. Norman, author of the report. “In fact, the generics market itself has become a hotbed of mergers and acquisitions from 2000-2007,” he added.
The report analyses the generics market’s most significant takeovers including; Sandoz obtaining Hexal, Teva’s acquisition of Ivax, Actavis’ purchase of Alpharma and the bidding war between Actavis and Barr for Croatian-based Pliva, which saw Barr pay $2.5bn.
The generics business has kicked off the image of being a poor relation in the pharmaceutical market and now dons the mantle of being the highest growing market segment. This market is bound to see a number of strategic takeovers as companies fight to increase market share and defend profit margins, says the report.
Worldwide, Brazil, Mexico, China, India and South Korea could have a significant impact upon the global development of the generics market. The study says Indian generics companies could be attractive acquisitions as the country is the home of many efficient generics companies and a major source of active pharmaceutical ingredients. They also score over their Chinese counterparts due to their higher skilled local population, even though China offers a larger market and an even lower cost base.
More information about the 60 page Consolidation in the Generic Pharmaceutical Industry: An evolving landscape can be found at http://www.urchpublishing.com/
