Express Pharma

ANDA approvals in 2019: Trends for the generics industry

0 11,814

Meenu Grover Sharma, Principal Consultant, BusinessAssociar Consultants, New Delhi, Scholar, Delhi Pharmaceutical Sciences & Research University, New Delhi and Dr (Prof) Harvinder Popli, Dean & Principal, School of Pharmaceutical Sciences, Delhi Pharmaceutical Sciences & Research University, New Delhi write about the ANDA trends seen by the generics industry in 2019

US-FDA continued with its momentum of previous years and granted 833 final ANDA approvals in the year 2019, slightly higher than the 813 final approvals in 2018. Additionally, 146 Tentative Approvals were also granted during the calendar year 2019.

Momentum maintained despite strong headwinds in the US generics industry
US Generics space has been under tremendous pressure for the last few years manifested in the form of significant pricing pressure, eroding profit margins, shrinking number of first-to-file windfalls, consolidation of buyers flexing their buying power, some big players like Sandoz, Teva divesting parts of and reorganizing their portfolio exiting pure generics spaces and continuing woes with negative outcomes of FDA-inspection for several players, especially in India and China.

Despite all these hurdles, the US generics market continues to attract a large number of ANDA filings and approvals, as also evidenced this year. Especially after some of the big players started divesting large parts of their generics portfolio, one might have anticipated a slowdown in numbers as these players with deep pockets were prolific filers in the past.

However, this year’s approval numbers do not show the expected dip as several other smaller and newer players, including some from China, started on the ambitious US-market dream. Another plausible reason could be that the companies that had already invested in development completed and filed the running projects, so the impact on number of approvals is not evident yet and will be seen over the next couple years, the lag is the time taken by companies to respond in terms of adjusting their business models and pipelines. Another hypothesis could be that having invested in the infrastructure, manpower and capacities, there is still no other option as lucrative as the US market, and hence companies that do not have the capability or resources to shift to speciality business are continuing to invest in commodity generics and adapting to the expectation of much-reduced returns. Lastly, of course, the analyst prophesies of rebound to better times in terms of easing pricing pressures is keeping the wheel moving at the same speed, at least thus far.

Regional trend: Indian companies continue to dominate, China registering the presence
In terms of regional trends, Indian companies continued to dominate with 374 or around 44 per cent of final approvals, followed by US, EU and then China. While India has remained at the forefront of the US generics market for several years, Chinese companies, traditionally considered a strong force in API space, are now steadily forward-integrating into the formulation space as well. In the year 2019, Chinese companies garnered 56 ANDA approvals which are 7 per cent of total final approvals. This number includes the approvals obtained by respective subsidiaries such as Nesher for Zydus or Watson and Actavis for Teva but does not include the companies in other regions with significant Chinese investment (such as Gland Pharma of India with 74 per cent stake of Fosun from China).

In addition to the global ambition of the Chinese companies, another reason for increasing participation in the US ANDA space is the domestic policies favouring high-quality products with overseas approval. A generic product that shares the same manufacturing line as the one approved by US FDA can qualify for priority review in the domestic market in China and thus becomes eligible for certain exemptions such as bioequivalence and can receive a much faster approval. Hence, a significant attractiveness for Chinese companies is getting access to domestic market simultaneous with the US market, through a US ANDA targeted development. Although Chinese companies still have a long way to go to come closer to the level of ANDA filing activity in India, the dual benefits are a strong indication that Chinese companies will continue to steadily keep building this capability.

Expectedly, oral solids hold a major share of approvals, but high-value products in complex forms such inhalation and vaginal ring also make a long-awaited appearance

60 per cent of ANDA approvals in 2019 were for oral solid dosage forms, of which 20 per cent were for extended-release or delayed-release formulations. Additionally, 20 per cent of total approvals were for injectable products. For Indian companies, 66 per cent of approvals were for oral solid dosage forms and this number is as high as 78 per cent for Chinese companies. The highlight among dosage forms is the approval for generic for Advair Diskus inhaler for Mylan and Nuvaring vaginal ring generic for Amneal.

Inhalers were one form where development of generics has remained complicated by need for similarity of device confounded by the complex IP scenario. This approval paves the way for similar approvals for more such products and more companies acquiring such capability in the near future. Another area in dosage forms which has traditionally remained lower activity segment has been the oral liquid forms – not because of technical difficulties but mostly because of logistics and cost-efficiency of transportation from distant geographies. This year witnessed over 50 ANDAs approvals for oral liquid products, majority of which were obviously from local US firms, but then again 13 approvals were also garnered by Indian companies, supported by their local manufacturing plants in the US.

Crowded markets becoming a norm, Indian companies have higher exposure to extremely competitive products
A sizeable 29 per cent of total approvals are for the products where there are 10 or more active ANDAs approved (without considering the discontinued ones, if any), pointing to companies continuing to invest in spaces erstwhile ignored for being very crowded. The proportion is even larger for Indian companies, with 35 per cent of approvals being for products with 10 or more active ANDAs. As the industry evolves and the talent-knowledge pool migrates between companies, a larger number of companies are developing technical competence to develop and file even those products that were earlier considered relatively difficult.

While some of these products may be large enough to attract more players, for others the continued filing could either be due to belief of these new entrants in their own cost-efficiency or other technological capabilities that they feel would support their quest for market share or it could just be a miss in their portfolio selection and review process, discovered far too late.

Conversely, there were 21 per cent approvals for products with three or less active approved ANDAs listed. A large proportion of these was contributed by non-oral solid dosage forms. Injectable and topical preparations still contribute a large proportion o