Generic Contraceptive Manufacturers

1
Generic Contraceptive Manufacturers

• Can They Help Increase Access To Affordable
  Products In The Developing World?

2
PSP-One industry primer

• Purpose
• To increase knowledge about the generic industry
• To explore partnership opportunities
• Methodology
• Literature review
• Interviews with procurement and industry experts
• Assessment trip to India

3
Key facts about Hormonal contraceptives

• Manufacturing
• Economies of scale are essential
• Complex quality/safety issues
• Importance of local regulatory environment
• Marketing and distribution
• RD companies lead worldwide
• Wide range of formulations, many off-patent
• Fast-growing generic industry
• Key differences between developed and developing
  markets

4
Two different types of markets

• Developed markets
• Strong regulatory environments
• Innovation-driven, commercial markets
• Strong RD presence2
• Growing use of Bioequivalent generics

• Developing markets
• Weak regulatory environments
• Limited product choice
• Large government and donor-funded programs
• Generics limited to NBE copy products

5
Hormonal contraceptive manufacturers

• RD companies
• Mostly Western-based with large international
  presence
• Focus on product innovation in developed markets
• Require high margins for marketing and RD
• Need economies of scale to control costs
• Favor large single-product contracts for
  developing countries

6
Hormonal contraceptive manufacturers

• RD companies
• Organon (Netherlands)
• Ortho McNeil (USA)
• Pfizer (USA)
• Schering (Germany)
• Wyeth (USA)

7
Hormonal contraceptive manufacturers

• Schering
• Annual revenues 4.9 billion
• Contraceptive products represent 30 of business
• Best-known brands Microgynon, Diane 35, Yasmin
• Leader in worldwide commercial markets
• Large institutional business (donors and
  governments)

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Hormonal contraceptive manufacturers

• Generic manufacturers
• Catch-all definition for non RD manufacturers
• Two types of generic products bioequivalent and
  NBE copy products
• Manufacturers differ widely in product quality,
  corporate strategies and marketing capability

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Hormonal contraceptive manufacturers

• Bioequivalent generics
• Pharmaceutical products that have demonstrated
  the same quality, safety and therapeutic efficacy
  as the originator brand
• Only the most developed markets are currently
  enforcing bioequivalence regulations
• Many generic contraceptives sold around the world
  have not been tested for bioequivalence

10
Hormonal contraceptive manufacturers

• Bioequivalent generic manufacturers
• Aspen Pharmacare (SA)
• Barr laboratories (USA)
• Watson Pharmaceuticals (USA)
• Teva Pharmaceutical Industries (Israel)
• Gedeon Richter (Hungary)
• Cipla (India)

11
Hormonal contraceptive manufacturers

• Barr Laboratories
• Largest US generic contraceptive supplier
• Sells predominantly to pharmacy chains
• Annual revenue 1 Billion
• 22 generic OC products
• Limited portfolio of proprietary brands Plan B,
  Loestrin, Seasonale, Nordette

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Generic products
Product development cycle
Source Barr Pharmaceuticals - http//www.barrlabs
.com/pages/induhist.html
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Hormonal contraceptive manufacturers

• Non-bioequivalent (NBE)
• Typically located in Asia and Latin America
• Two major types manufacturers of branded
  generics, and contract manufacturers
• Two different business models commercial and
  institutional

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Commercial model
Marketing
Products
Manufacturer
Distributor
Field sales force
Healthcare providers
Wholesaler
Retailer
Patient
15
Institutional model
Bid/contract
Products
Manufacturer
Client warehouses
Procurement tender or trade marketing
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Generic contraceptive manufacturers
Manufacturers of branded generics (commercial
model)
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Generic contraceptive manufacturers

• Laboratorios Silesia (Chile)
• Large portfolio of NBE contraceptive formulations
• Competes directly with RD brands
• Multiple therapeutic areas
• Extensive commercial distribution in Latin
  America

18
Generic contraceptive manufacturers
Contract Manufacturers (institutional model)
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Generic contraceptive manufacturers

• Famy care (India)
• Limited portfolio of OCs
• No other therapeutic area
• Trade brands, not commercially marketed
• Major supplier of OCs and IUDs to government
  programs

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Generic contraceptive manufacturers

• Famy care (India)

COMBINED PILLSame Composition ORALCON 0.15 mg
Levonorgestrel 0.03 mg Ethinylestradiol
LEVONYL 0.15 mg Levonorgestrel 0.05 mg
Ethinylestradiol LO-LEVONYL 0.125 mg
Levonorgestrel 0.03 mg Ethinylestradiol
FAMYNON 0.25 mg Levonorgestrel 0.05 mg
Ethinylestradiol LO-FAMYNON 0.25 mg
Levonorgestrel 0.03 mg Ethinylestradiol
FAMYNOR 0.50 mg Levonorgestrel 0.05 mg
Ethinylestradiol LUSIA 0.30 mg Levonorgestrel
0.03 mg Ethinylestradiol PHASIC / SEQUENTIAL
PILLSName Compostion TRIGESTREL 0.05 mg of
Levonorgestrel 0.03 mg of Ethinylestradiol
0.075 mg of Levonorgestrel 0.04 mg of
Ethinylestradiol 0.125 mg of Levonorgestrel
0.03 mg of Ethinylestradiol DIALZA 0.15 mg of
Levonorgestrel 0.03 mg of Ethinylestradiol
0.20 mg of Levonorgestrel 0.04 mg of
Ethinylestradiol PROGESTAGEN ONLY PILL /
MINIPILL Composition HYAN 0.03 mg
Levonorgestrel FAMYREL 0.075 mg
Norgestrel LO-FAMYREL 0.070 mg
Norgestrel EMERGENCY CONTRACEPTION
PILL Composition PREGNON 0.75 mg Levonorgestrel

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What role for generic manufacturers?

• Three potential areas
• Supplying government and donor programs
• Supplying NGOs and SMOs
• Competing on commercial markets

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Government/donor market

• Key factors price, quality and capacity
• Contract manufacturers best positioned to capture
  this market
• Barriers
• Registration costs
• Concerns about product quality
• Donor prequalification requirements (such as FDA
  registration)

23
NGO/SMO market

• Key factors price, quality, marketing capacity
• Contract and branded generic manufacturers well
  positioned to capture this market
• Barriers
• Registration costs
• Concerns about product quality

24
Commercial market

• Key factor Marketing capacity
• Branded generic manufacturers best positioned to
  capture low-end market
• Potential barriers
• Registration and marketing costs
• Low demand and ability to pay
• Competition from subsidized brands

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Are branded generics cheaper?
Profit And Loss Statement For RD And Generic
Brands
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Opportunity matrix
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Opportunity matrix
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Conclusions

• Generic manufacturers are not a homogenous group
• Bioequivalent generic manufacturers are most
  likely to focus on developed markets
• Opportunities exist for contract and branded
  generic manufacturers in developing countries
• Prequalification requirements are main barrier in
  the public and NGO sector
• Competition from subsidized products is the main
  barrier in commercial markets
• Activities involving generic manufacturers should
  be consistent with their business model