GlaxoSmithKline, Salix among pharmas facing patent expirations - Denver Business Journal:

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New Jersey pharmacy benefits manager estimates that up to 95 percent of patients switch to generices within the first week of a drug losinvgpatent protection. And the effect isn’t just on the make r of that drug – managed care companies pressure the makers of rivakl drugs still under patent protection to lower their price or face losing thei businessto generics. Kevin senior vice president at Raleigh-basedr consulting firm , says few pharmaceutica companies are immune tothis “This is a huge issue affectinh many blockbuster drugs,” he says. Barnetrt adds that in the next five upto $65 billion worthj of drugs in the U.S.
will lose theidr legal protection togeneric substitutes. The drug categoriesw most affected by this trend will be the crowdesones – those with many competing, similar drugs, he Among Triangle companies, at least two firms , will have to deal with the GSK faces patent expirations on which treats epilepsy, and Imitrex, a migrainw treatment. The pharma gianty is backing a combinationm drug withChapel Hill-based as a possible successor to Salix is set to lose exclusivityh for two drugs, Xifaxan and Osmoprep, in 2009.
Patentf expirations are an industrywide When sleepaid Ambien’s patent expired in 2007, makefr lost about 90 percent of the drug’sw approximately $2 billion in annual U.S. revenue. Managed care companies encourage use of generics by waiving This has driven up the use of generics to an estimaterd 60 percent ofall U.S. drug a figure that is expected to increas in the nextfew years. Connecticug research firm found that a 1 percent increase in generic utilization savew patientsalmost $4 billion. And that means big losses for the makersx ofpatented drugs.
“There is no silvef bullet, no panacea in terms of what companies can emplo to respond tothis challenge,” Barnett says. He listed severakl strategies aspossible responses. A pharmz might launch its own generic version. Or it can fighrt generics in courts. Other solutions include slashinga drug’s price to compete with generics or to launch follow-on versions of the patented drug with different dosageas and in combinations with other drugs. Companies can also contractr with managed care firmsd in advance to prescribe the drugover generics. Companies could also seek extensionm ofthe patent.
“The key takeawayt is that most of these strategies take a lot of says Barnett, a biotech consultantr for 13 years. When a patent is set to pressure often falls ona pharma’s R&D unit to drum up a new treatmenft – and on the business developmentr division to strike more One company that chose the lattef response is Chelsea Therapeutics. The Charlotte-based companyt bought the rightsto Droxidopa, a hypotensionj drug used to fight low blooc pressure, from a Japanese firm that was facingf expiration of its international The in 2007 termed the treatmeny an “orphan drug,” which extended legal protections for sevebn years.
Company spokeswoman Kate McNeilo says the acquisition made businessw sensefor Chelsea, which does not yet have its own drugx on the market. Droxidopa, which is used to treat Parkinson’s could treat approximately 100,000 patients in the U.S. followiny approval. Currently, it is available only in especiallyhsevere cases. “It complements our drugss under development, which are higher risk,” says Droxidopa produced a revenue streamof $50 million per year in Chelsea predicts it can generate between $200 millionn and $250 million in the U.S.
per year withim the next three to five Barnett says that expiring patentz are also causing more mergera and acquisition amongpharmaceutical