An expanding market, a growing population, a regulatory regime supportive of the generics sector, robust domestic production and many untapped opportunities. Is Brazil the place for generic companies to be? The world's major emerging economies are attracting much investment and interest. Brazil is not least among them, and it is easy to see why with a population of 189 million and a GDP of US$978 billion in 2007.

But there are particular attractions for the producers of generic pharmaceuticals. For years the “generic” market was little more than a series of copycat products, similar to the branded product but not necessarily bioequivalent. Under increasing pressure from industry to respect patents, and with one eye on the need to cost effectively meet the growing health needs, the Brazilian authorities have led the way in the region in creating a market for truly bioequivalent generic drugs which now ranks in the top ten worldwide.

The generics market, already in a strong growth phase, is well placed to continue its future expansion. The generic production of oral contraceptives and endogenous hormones was approved in March 2007, a number of leading brands are due to lose their patent protection over the next 5 years and the use of generic drugs is expected to grow as price pressures bite.

But who are the leading players and what are their strengths? What barriers to market entry exist? What routes to market are favourable? What will be the operating and regulatory environment for companies? The answers to these and many other questions can be found in this new 200-page management report Opportunities and Challenges for Bioequivalent Generic Drugs in Brazil (Published April 2007).
Key areas addressed:
5-Year market forecast to 2012
The generics market in context
Review of the product registration procedure
Pricing issues and reimbursement
Political, legal and economic assessment
Insightful review of 20 major domestic and foreign players in the market
Detailed product registration data. Who produces what?

Includes much information not available in English elsewhere! THE BRAZILIAN GENERIC MARKET IN CONTEXT
Strong generic pipeline.
A number of products are due to lose their patent protection between 2007 and 2012, bringing market opportunities worth US$307.2 million to the generics sector. Key products affected include Plavix in 2007, Mercilon in 2009 and Viagra and Lipitor, both in 2011. At manufacturers' prices, their respective sales stood at US$41.1 million, US$58.3 million, US$73.1 million and US$53.4 million in 2005.

Furthermore, in March 2007, ANVISA authorised the registration of generic alternatives to oral contraceptives and endogenous hormones. This sector was valued at US$481 million in 2006 and generic producers are expected to account for 60% by 2012. The leading producers, including Medley, EMS-Sigma Pharma and Eurofarma, have indicated that they will enter this market.

Meeting the challenge of AIDS
Since 1996, antiretrovirals have been provided free of charge to HIV/AIDS patients. The cost per patient fell from R$8,500 (US$4,574) in 1999 to R$3,400 (US$1,162) in 2004, but rose to US$2,500 in 2005. Costs remain high as imported antiretrovirals represent between 80% and 85% of the national AIDS programme's expenditure. According to the Ministry of Health, public domestic manufacturers produce eight of the 17 antiretrovirals used.

Brazil can issue compulsory licences and allow local generic production of imported antiretrovirals. So far, it has negotiated drug price reductions and encouraged local production under licence. However, the rising number of patients, increasing levels of drug resistance, rising costs, the lack of systematic surveillance of HIV prevalence and high-risk behaviour might still be a threat.

Domestic producers dominate…for now?
There were 66 producers with registrations of generic medicines in 2006, but the four leading producers, which are indigenous, controlled over 80% of the sector. Medley and EMS were the leaders, with a combined 65% market share, followed by Eurofarma and Aché. Mergers & acquisitions will continue to consolidate the Brazilian generics market.

Local producers dominate with low prices and increasing production capabilities. They also have the local know-how to deal with bureaucracy and the government favours them. With the global generics markets consolidating into ever bigger groups, markets such as Brazil are increasingly under scrutiny from large generic corporates. All - with the exception of Teva - have some presence or alliance in Brazil, but it is probably only a question of time before the domination of the market by local companies changes.

The prescribing challenge.
If the generics market is to reach its full potential then it will have to tackle the prescribing habits of a great number of doctors who continue to prescribe branded products. Prescription of generic medicines is still low, representing 15.8% of the total in 2006, compared to 15.2% in 2005 or 11.8% in 2002. For some specific substances, however, generic medicines have achieved high prescription levels, for instance omeprazole (88%), cephalexin (77%) and fluconazole (65%). Using generics, consumers saved about US$2.2 billion in 2006.

Domestic producers of generic pharmaceuticals evaluated in the report:
Aché-Biosintética
Americano (FARMASA)
Arrow (Erowlabs)
Brainfarma
Cimed
Cristália
EMS-Sigma Pharma
Eurofarma
Hipolabor
LAFEPE
Medley
Neo Química
Prati, Donaduzzi
Teuto
União Química

Foreign producers of generic pharmaceuticals evaluated in the report:
Abbott
Apotex
Mepha-ratiopharm
Merck
Ranbaxy
Sandoz

The report answers key questions such as:
What is the estimated value of the bioequivalent generic market now and in 2012?
What is the current regulatory situation for bioequivalent generics and how might it change?
What are the opportunities for international players looking to expand operations in Brazil?
How many products have just a single producer of a bioequivalent generic? What are they and which company is currently producing?
What key educational challenges must the industry overcome if it is to see the wider adoption of generics throughout the country.

About the Author:
This report has been written by Espicom staff writer Ricardo Vicente. Ricardo has over 5 years market analysis experience in pharmaceuticals. He is the editor of Espicom's leading Latin American market analysis service in World Pharmaceutical Markets (WPM). Among his recent studies are:
The Latin American Market for Generic Drugs
The Outlook for Pharmaceuticals in Latin America to 2011

HIGHLY DETAILED REPORT CONTENTS

REGULATORY ENVIRONMENT
Regulation of generic medicines vs similar & biosimilar medicines;
Registration of generic medicines ;
Authorised centres to perform bioequivalence studies;
Marketing authorisations of generic medicines;
Labelling & packaging requirements for generic medicines;
Patent protection vs extension;
Pricing policies affecting generic medicines

MARKET ANALYSIS
Market overview of generic pharmaceuticals in Latin America, 2006;
Overview of the pharmaceutical market in Brazil, 1997-2006;
Pharmacy sales of generic pharmaceuticals in Brazil, 2000-2006;
Market projections of generic pharmaceuticals in Brazil, 2007-2012;
Espicom SWOT analysis of generic pharmaceuticals in Brazil, 2007;
Domestic production of generic pharmaceuticals

MARKET OUTLOOK
Generic production of oral contraceptives & endogenous hormones;
More uniform market penetration across all the regions;
Unsustainable reliance on research-based HIV/AIDS medicines;
Foreign producers of generic medicines, squashed by local competition;
Sales strategies devised by producers of generic medicines;
Potential government production of bioequivalent generic medicines;
Research-based medicines with patents expiring between 2006 & 2013;
Challenges in the public sector;
Teva's acquisition possibilities in Brazil;
High cost savings vs low prescription levels

COMPANY REPORTS
Product portfolio, financial indicators & manufacturing capabilities for over 20 producers.