By Ben Hirschler | LONDON (Reuters) - Generic drugmakers, hoping for rich pickings from the launch of copies of GlaxoSmithKline's best-selling Advair inhaler in the United States next year, say they can win business without a race to the bottom on price. "Nobody wants to kill the market," said Rajiv Malik, president of Mylan, which will have the first commercial Advair copy, assuming U.S. regulators approve its substitutable generic device by a target date of March 28, 2017. A rival version from Hikma and Vectura is hot on its heels, with an approval date of May 10. After that, however, there will be a hiatus, which Malik thinks will curb excessive price discounting. "It will be GSK plus one competitor for some months and then two competitors for maybe 12 to 18 months," he said in an interview. "We believe it is not going to be a commodities product." Ventura chief executive James Ward-Lilley agrees, pointing out that the two initial generic suppliers will not be in a position to replace all GSK's business. “Mylan won’t have the manufacturing capacity to serve the whole market. Nor will we. That should lead to some rational behavior in terms of pricing,” he said. The stakes are high for all concerned. Advair, for asthma and chronic obstructive pulmonary disease (COPD), is a major opportunity for generics companies at a time when fewer blockbuster medicines are losing patent protection, after a wave of expirations that peaked in 2012. For GSK, U.S. generic Advair is a challenge as tries to return to growth while coping with declining sales of a product that has sold more than $1 billion annually since 2001. Global Advair sales, which hit a high of $8.3 billion in 2013, were $5.6 billion in 2015, with half that generated in the United States. Although Advair is already available generically in Europe, demand for copies is expected to take off more swiftly in the United States, where managers of prescription plans, like Express Scripts, can quickly drive conversion. "You see in the U.S., unlike in Europe, very rapid switching between brands and between molecules and between devices," said Ward-Lilley. "Doctors are agnostic and are not in control of the decisions." The U.S. price of Advair has already come down a lot in the past two years, under pressure from players like Express, and falling revenues means it accounted for 12 percent of GSK group sales in the first quarter, down from 20 percent in 2013. Advair inhalers, typically lasting a month, officially retail for more than $330 in the United States but industry analysts estimate GSK can offer discounts of around 50 percent. GSK declined to comment. ADVERTISEMENT Nonetheless, Malik said there remained "quite a bit of room" for generics to undercut Advair without wrecking the market. "Yes, GSK has been under price pressure recently but the price is still pretty attractive to bring in a generic," he said. Although the U.S. patent on Advair expired in 2010, an additional patent on the Diskus inhaler used to deliver the drug runs until August 2016. That and the difficulty of making the two-in-one medicine has delayed competitors. Malik, who says Mylan has invested some $325 million in a factory in Ireland to make generic Advair, expects competition down the road from Sandoz, the generics unit of Novartis, and Teva - but it won't be a crowded market. There are, of course, still regulatory uncertainties. Will the U.S. Food and Drug Administration give approval on time or will it delay, given the complexity of the drug and device? And will generics be fully substitutable, as their makers hope? After years of citing the difficulty of copying Advair, GSK changed its tune last year and said it was now factoring in the prospect of U.S. generics, which could erode U.S. Advair sales to just 300 million pounds ($433 million) in 2020. Yet GSK still expects its respiratory business in 2020 to be at least as big as it was in 2015, thanks to the arrival of new lung medicines, including new kinds of inhaled drugs, a recently approved injection for severe asthma and a three-in-one inhaler for COPD. "We're feeling rather positive about the positioning of new products in the respiratory field at a time when Advair sales are coming down," said Patrick Vallance, GSK's president of pharmaceuticals R&D. (Reporting by Ben Hirschler; Editing by Ruth Pitchford)
What is your opinion regarding the impact of generic Advair on Symbicort business? Will Bevespi have a chance to gain any traction in the marketplace? Is AZ lean and mean after multiple layoffs, or will generic Advair necessitate further future layoffs? I am an AZ rep and I am genuinely curious about everyone's thoughts.
Well, this dyhas been long coming, and is almost here. It will destroy Symbicort, as expected. Bevespi is really no better than either Symbicort or Adair, and it's not worth the extra expense. Look for massive cuts in respiratory.
The window is now, for Bevespi. Docs will add a small particle ICS should it be needed. Time to put pedal to the metal....
Generic Advair will not drop the price much, at least initially. Only one supplier and then two. Maybe AZ should be aggressive and drop the Symbicort price once two Advair generics are on the market. Let the reps promote a great product for a reasonable price. It would certainly help with managed care access!
OK Mr. Awesome, let me ask you: How will you grow share when MCO's and IDN's w/ their own formularies mandate a step through generic Advair before Symbicort can be used? Before you answer, remember Crestor. You had a statin that had clearly better LDL reductions vs. any of the statins w/ a favorable P-450 profile. Yet, share eroded to a national average of 10%ish. With nothing similar occurring on the COPD combo market, again, how will you grow? Having been in pharma thru many of these situations, my expectation will be to see Symbicort below 20% nationally within a year after the generic is intro'd. So I hope your paper bag is very thin because you will need all the help you can get.
At the end of 2015, 89% of meds dispensed were generic..probably higher now that we are in 2017...managed care makes these decisions not the provider...you are very naive!!! Of course, you can promote in this environment..just makes it way more difficult!!! The respiratory market has not had to deal with generics..that is about to change!!!
I just read that Teva's generic Advair had been approved by the FDA. It will be on the market in three or four months. The massive Symbicort market decline won't really start until the end of the year. However, 2018 will be a bloodbath!
Looking at the GSK board, they know masssive layoffs are coming due to generic Advair. This might be a good time to get out of respiratory!
Watch the CBD's scurry trying to find a home. It will be comical. What happened in December is just a phase. There will be several more. Diabetes will be downsized, PCP will be hit hard (especially when Bevespi doesn't live up to the hype), CV too. Asthma biologic and Oncology are the only "safe" places. I could realistically see PCP cut by >50% by this time next year.
TIC TOC, TIC TOC, TIC TOC. JUST LOOK AT THE BACKGROUND OF YOUR LEADERSHIP... Meetings, field rides, Bull Shit reports, and more reports due by you to say the same lies . How are you goals for this quarter? How is you you RR? Figure how you get that fab trip for COE ? Are you selling or giving out free cards to by pass the insurance companies ? Ha Ha Ha
