India expected to lead patent cliff opportunity in the USA

A huge patent opportunity is supporting the Indian pharmaceutical sector, as several older and once lucrative drugs are losing their patent, presenting a $240 billion opportunity over the next five-six years until 2026.

With a second patent cliff looming on the horizon, the Indian drug industry has the potential to add $15 billion to become a $60 billion sector over the next two years, state analysts at Care Ratings, adding that many Indian players are already working to develop the generic version of patented products.

This year’s blockbuster patent losses of US exclusivity include the Roche (ROG: SIX) macular degeneration drug Lucentis (ranibizumab), two medicines from AbbVie (NYSE: ABBV) and a Pfizer (NYSE: PFE) cancer drug, among others.

The pharmaceutical industry in India is expected to reach $60 billion by 2023 and $120 billion by 2030, said an official adding the pharmaceutical industry in India is currently valued at $41.7 billion.

Generic drugs, with 71% market share, form the largest segment of the pharmaceutical industry in India. This is set to grow as exports of generics to the USA rise, and as branded drugs come off-patent.

The first mover advantage, strong process engineering skills and access to low-cost talent of Indian pharmaceutical companies is expected to aid the trend. Indian companies also have invested significant resources toward the development of a robust pipeline of generic drugs and several firms have been responsible for one-third of the Abbreviated New Drug Application (ANDA) filings.

India's share in total ANDA approvals has increased to around 40% in calendar year 2020 from 36% in CY 2017. This went up further to 44% in CY 202121 by June 2021. India also has the distinction of having the largest number of US Food and Drug Administration-compliant pharma plants outside of the USA. With the available US FDA compliant infrastructure, analysts maintain India will lead the patent cliff opportunity in the USA.