Paul Thomen

Tuesday, 9 April 2013

PharmaLeaders Manufacturers Financial Benchmarking & Competitive Analysis 2013

Sun Shines on Indian Generics Manufacturers

India is becoming a key market for generic medicines, and pharmaceutical companies must compete and grow their revenues there to have a shot at claiming the title of industry leader, according to a new report by research and consulting firm GlobalData.

The new report* states that India-based trio of Glenmark, Sun Pharmaceuticals, and Ranbaxy topped the charts in terms of year to year (YTY) revenue growth in 2012, with 71.6%, 47.6%, and 32.9% respectively. Although larger generic manufacturers – Teva, Sandoz, and Mylan – emerged as revenue leaders in 2012, with sales of US$10.4 billion, US$8.7 billion, and US$5.8 billion respectively, their performance in 2013 may vary, as other competitors, including Sun Pharmaceuticals step up efforts to grow their share of the global generics market.

Domestic players in India are currently experiencing massive growth YTY revenue as they continue to leverage many decades of reverse engineering experience. GlobalData believes that Indian generic manufacturers have become the go-to companies when it comes to low-cost generics, as affirmed by the entrance of pharmaceutical giants such as Gilead and Pfizer into generic manufacturing agreements with them in 2012.

Sun Pharmaceuticals holds a strong position in the Indian generics market, leading the pack in terms of operating margin and revenue growth, although the company’s sales figures currently pale in comparison with larger companies. The company’s domestic revenues increased by 44.9% from US$586.5m in 2011 to US$865.9m in 2012, as market shares were captured from competitors. Sun Pharmaceuticals will have to continually compete with other Indian generic manufacturers, including Ranbaxy, Dr. Reddy’s and Cipla, as well as the influx of foreign generic and branded pharmaceutical companies. This rivalry, which is likely to focus on the price sensitivity of domestic consumers, could potentially decrease the company’s profit margins. Nevertheless, GlobalData anticipates that Sun will be one to watch in 2013, as the company aims to rub shoulders with companies in the top echelon of generics manufacturing.

Mylan benefited from aggressive growth in the Indian market during 2012, as the company’s generics business flourished in the country. This resulted from an increase in sales of anti-retroviral (ARV) finished dosage form (FDF) generic products, used in the treatment of HIV/AIDS. Mylan is currently one of the world’s largest API manufacturers, particularly in  APIs used in manufacturing generic ARV therapies for HIV/AIDS treatment. The company has total control over its supply chain, and so can effectively control cost and quality – two crucial requirements in the pharmaceuticals business.

Similarly, Teva and Sandoz are stepping up efforts to grow their revenues outside established markets. Sandoz, in particular, needs to gain ground in emerging markets, as 80% of its generic pharmaceutical sales currently come from the US and Europe, leaving the company exposed to the current pricing pressures and budget deficits in these markets.

PharmaLeaders: Generic Manufacturers Benchmark Report - Financial Benchmarking & Competitive Analysis of the Leading Generic Players in 2013 report applies GlobalData’s proprietary ranking methodology to compare the competitive position of 30 generic pharmaceutical companies across various markets on 12 financial metrics. It provides analysis of the key drivers and trends shaping the global generics industry, identifying the key generic players in various markets, and including a special focus on emerging markets such as India, China, Russia, and Brazil.

Table of Content

1 Table of Contents 6
1.1 List of Tables 10
1.2 List of Figures 11
2 Introduction 13
2.1 Report Scope 13
2.2 Upcoming Related Reports 15
2.3 Recently Published Reports 15
2.4 GlobalData's Benchmarking Methodology 16
3 GlobalData Benchmark Rankings 17
3.1 Sun Pharmaceuticals Emerges as Generics Leader 17
4 Financial Management 19
4.1 Competitive Framework 19
4.2 Overview 19
4.3 Financial Management: Heat Map 22
4.4 Financial Metrics 24
4.4.1 Revenue Leaders 24
4.4.2 Revenue Laggards 26
4.4.3 Revenue Growth Leaders 28
4.4.4 Revenue Growth Laggards 30
4.4.5 Operating Income Leaders 32
4.4.6 Operating Income Laggards 33
4.4.7 Operating Income YTY Growth Leaders 35
4.4.8 Operating Income YTY Growth Laggards 36
4.4.9 Operating Margin Leaders 39
4.4.10 Operating Margin Laggards 40
5 Expense Management 43
5.1 Competitive Framework 43
5.2 Overview 43
5.3 Expense Management: Heat Map 46
5.4 Expense Metrics 48
5.4.1 SG&A Spending Leaders 48
5.4.2 SG&A Spending Laggards 49
5.4.3 SG&A YTY Change Leaders 51
5.4.4 SG&A YTY Change Laggards 52
5.4.5 Operating Expense Leaders 54
5.4.6 Operating Expense Laggards 55
6 Capital Management 58
6.1 Competitive Framework 58
6.2 Overview 58
6.3 Competitive Framework: Heat Map 60
6.4 Capital Management Metrics 61
6.4.1 Debt-to-Assets Leaders 61
6.4.2 Debt-to-Assets Laggards 63
6.4.3 Cash Ratio Leaders 65
6.4.4 Cash Ratio Laggards 67
6.4.5 ROI Leaders 69
6.4.6 ROI Laggards 70
7 Key Players 72
7.1 Strategic Analysis of Leading Generics Players 72
7.1.1 Sun Pharmaceuticals: The Benchmark Leader 72
7.1.2 Sandoz 76
7.1.3 Pharmstandard 79
7.1.4 Teva Pharmaceuticals 81
7.1.5 Actavis 86
7.1.6 Mylan 90
7.1.7 Ranbaxy 93
7.1.8 Dr. Reddy's 94
7.1.9 Covidien 95
7.1.10 Hospira 96
8 Outlook 97
8.1 Leverage Improvement will Significantly Alter 2013 Benchmark Rankings 97
8.2 Generic Manufacturers in Emerging Markets will continue to Challenge for Top Spots 97
9 Appendix 99
9.1 Bibliography 99
9.2 Abbreviations 99
9.3 Research Methodology 101
9.3.1 Coverage 101
9.3.2 Secondary Research 102
9.3.3 Expert Panel Validation 102
9.4 About the Authors 102
9.4.1 Analyst 102
9.4.2 Director of Healthcare Industry Dynamics 103
9.4.3 Global Head of Healthcare Research and Consulting 103
9.5 About the Industry Dynamics Team 104
9.6 About GlobalData 104
9.7 Contact Us 104
9.8 Disclosure Information 105
9.9 Disclaimer 105

For more details contact Mr. Priyank Tiwari: / +18883915441

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