Faridabad, Haryana,  According to a technical market research report, Generic Drugs: The Global Market from BCC Research (PHM009E), the global market for generic drugs was worth $84 billion in 2009, a figure that is expected to reach $129.3 billion in 2014, for a compound annual growth rate (CAGR) of 9% over the 5-year forecast period.

The generic market came of age during the 1990s and the generic industry consolidated its position during the first years of the new millennium. Starting as a patchwork of national marketplaces, the generic world now rivals the traditional pharmaceutical universe.

However, this is a volatile time for the generic pharmaceutical sector. The demand for generics is increasing steadily because of pressure to control healthcare costs. At the same time, fierce price competition is resulting in slashed profit margins for participating companies. A major growth driver for the generics sector is that several blockbuster pharmaceutical brands are coming off-patent and are therefore open to generic competition. And the international landscape is changing for generics as for all pharmaceuticals. China, India, Eastern European countries and Brazil are among rising centers of generic activity.

This report, Generic Drugs: The Global Market, values the current global generics market in developed countries at an estimated $59 billion. Of the latter figure, the five major European national markets account for 23%, the U.S. for 42%, and Japan for 6%.

Generic penetration varies widely from country to country; in Europe, for example, generics account for almost 18% of the German pharmaceutical market but only 11% of the pharma market in France. The European average share is 15%; this compares with 10% of the U.S. pharmaceutical market, but only 6% of the market in Japan.

In terms of growth, generics have outstripped "regular" pharmaceuticals and seem certain to grow more quickly during the next decade, driven by:

• Aging populations, especially in developed countries, driving up the costs of healthcare including drugs
• Problems faced by payers (governments, HMOs, individuals) in attempting to pay for expensive branded pharmaceuticals
• General economic downturn exacerbating the above problems
• Emergence of new national markets for pharmaceuticals among developing economies, needing to install affordable healthcare systems
• Wider access to information about pharmaceuticals via the internet, leading to fuller appreciation of the value of generics in the public domain
• Increasing involvement of "big pharma" in the generics arena, improving the public perception and acceptance of generics
• Loss of patent protection by a succession of blockbuster products, creating new opportunities for generics.

Although the worldwide economic downturn which began to take hold in 2008 led to slower growth for pharmaceuticals overall, the negative effect was less marked in the generic sector, and in the medium to long term it is expected that generic markets will continue to show positive growth, and at a faster rate than mainstream pharma.

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