The global generic drugs market size is forecast to advance at a CAGR of 7.20% during 2022–2030, to reach $705.1 billion by 2030.
The growth is mainly ascribed to the increasing aging population, surging number of branded drugs losing their patient protection, growing prevalence of chronic diseases, and rising R&D investments by pharma and biotech companies. During and since COVID-19, the demand for generic drugs has been high from patients and healthcare systems, which continues to support companies operating in this field.
This is essentially because generic drugs are cheaper than branded drugs. According to an article published by the National Center for Biotechnology Information (NCBI), the price of the branded versions of cetirizine, fluoxetine, alprazolam, and lansoprazole, was 41%, 33%, 31%, and 14%, respectively, more than the generic versions of these drugs.
The indirect channel category held the larger share in 2022. This was on account to the increasing cases of chronic as well as acute diseases and the rising number of hospitals, clinics, and pharmacies across the globe. The indirect channel includes retail pharmacies/drug stores, hospitals, private clinics, and online pharmacies, which cater to the majority of the individual consumers of medicines.
The U.S. dominated the market in 2022, and it is set to remain on its position during the forecast period. The Centers for Disease Control and Prevention says that chronic diseases, such as cancer, heart disease, and diabetes, are the leading causes of death in the U.S. Additionally, according to an article published by the PFCD, almost 45% of the people in the U.S. suffer from one chronic disease at least, and around 165 million Americans will have more than one such condition by 2025. The high cost of the treatment of a large number of chronic diseases has created an urge among patients as well as the healthcare system to seek alternatives to the high-cost branded drugs.
The market in Japan is expected to grow at a steady rate, ascribed to the rising prevalence of chronic ailments and surging geriatric population. The declining fertility rate in the Japanese population is one of the main reasons for the rising aging population in the country.
Moreover, U.S.-based generic drug makers have increased their R&D expenditure, in order to cater to the surging demand for more-effective and cheaper drugs. This is due to the huge savings that the players get by manufacturing generics. Additionally, at the beginning of the pandemic, the U.S. government gave more than $30 billion to enhance the country’s drug supply chain, to handle the situation.
Addressing the high cost associated with branded drugs, government organizations have made significant changes to their approval processes for generic drugs. These measures have been taken to increase the availability of low-cost medications for patients.
Some of the major global generic drugs market players are Cipla Ltd., Aurobindo Pharma Limited, Dr. Reddy’s Laboratories Ltd., STADA Arzneimittel AG, Alkem Laboratories Limited, Hikma Pharmaceuticals plc, Teva Pharmaceutical Industries Limited, Sawai Pharmaceutical Co. Ltd., Mylan N.V., Mallinckrodt plc, Lupin Limited, Torrent Pharmaceuticals Ltd., Endo International plc, and Amneal Pharmaceuticals Inc.