Indian Companies Gain Approval for 88 ANDAs in US During First Half of 2012
Indian companies were the beneficiaries of 88 of the 214 approvals that were given by the US FDA for Abbreviated New Drug Applications (ANDAs) during the first half of 2012.
IHS Global Insight Perspective
Indian companies continue to increase their profile in the United States market, having benefited from 88 of the 214 approvals that were given by the US FDA for Abbreviated New Drug Applications (ANDAs) during the first half of 2012. A large number of additional ANDAs are still pending.
Many of the leading Indian drug companies have been increasing their investment in research and development, with a view to expanding their activities in highly regulated developed markets including the US, Europe, and Japan.
The heavy involvement of India's pharmaceutical industry in the US market means that its companies will be heavily impacted by the US' Generic Drug User Fee Act, due to take effect from October, whose fees have been described by the Pharmaceutical Export Promotion Council of India as "exorbitant". However, for leading companies, long-term gains are likely to outweigh the new costs.
According to Pharmabiz, the number of Abbreviated New Drug Applications ANDAs achieved by Indian companies was exactly the same as in the corresponding period of 2011, although the percentage of the total number of approved ANDAs was higher: 41.1% in the first six months of 2012, compared to 37.0% in the first six months of 2011. During the first half of 2012, Indian companies also achieved 21 tentative approvals (out of a total of 49 tentative approvals), compared to 19 (out of 50) in the corresponding period of 2011.
Sun Pharma and its subsidiaries (including Taro Pharmaceuticals) came out top among Indian companies, securing 12 ANDA approvals in the first half of 2012. Sun Pharma was followed in the rankings by a number of companies with nine ANDA approvals, namely Aurobindo Pharma, Dr Reddy's and Strides Arcolab.
In terms of tentative approvals, Cipla came out top with five, followed by Micro Labs (three), and two each for Hetero Labs, Lupin, Mylan, Sun Pharma, and Torrent Pharma.
Many of India's leading companies also have a large number of ANDAs awaiting approval. For example, as of the end of March 2012, Sun Pharma had 147 ANDAs awaiting approval, including 19 tentative approvals; Dr Reddy's had 80 ANDAs pending approval; and Aurobindo Pharma had 109. That said, in many cases the approvals have been pending for a considerable period: Dr Reddy's filed only 17 ANDAs during 2011/12, while Aurobindo Pharma filed 25.
Outlook and implications
The high number of approvals for Indian companies can be attributed to increased investment in research and development (R&D). For example, in the year to March 2012, Sun Pharma's R&D expenditure rose to 4.4 billion Indian rupee (USD78.6 million), which corresponded to 5.5% of sales. In the case of Dr Reddy's, the company's R&D expenditure shot up by 16.8% in the 2011/12 financial year to reach INR5.91 billion, and Lupin's R&D spend was up by 8.3% to INR4.83 billion. Ranbaxy was one of the few leading Indian companies to buck this trend, with its R&D expenditure declining from INR4.98 billion in the 12 months to December 2011, to INR4.7 billion during the company's 2012 financial year.
The heavy involvement of India's pharmaceutical industry in the US market means that its companies will be heavily impacted by the US's Generic Drug User Fee Act, which is due to take effect from October. The Pharmaceutical Export Promotion Council of India has recently been seeking clarification from the US FDA over the structure of the fees, which it believes to be "exorbitant" (see India: 6 July 2012: India's Pharmaceutical Export Council Seeks Greater Clarity on US's New Generic User Fees).
Although Indian companies have concerns over the high fees, they do, however, broadly welcome the prospect of FDA inspections: approval by the FDA will ultimately give them increased credibility as they target further expansion in developed markets around the world.
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