Generics Grow Brazilian Drug Market

According to a survey carried out by IMS Health and local market researchers, the market share of generic medicines has reached 27.7% in Brazil. The study's findings indicate that the sector has succeeded in expanding the drug market in Brazil, mainly by increasing lower-income groups' access to the drugs.

However, the study cautions that this impressive share corresponds only to the market segments in which generics can be legally distributed. Further, if OTC drugs, branded patented medicines and hormonal treatments are included, the generic sector's market share falls to 9.69%, or roughly US$880mn. Brazilian regulators authorise only certain higher-tech generics, with the leading patented import usually acting as the reference product for each therapeutic category.

Evidence of this is the stellar performance of some off-patent statins, with generic sales of one product increasing 150% to 4mn units between 2001 and 2004. Unit sales of diabetes treatment metformin almost doubled in the period to 8.02mn. Meanwhile, the survey also indicates that average sales of branded reference products fell 21%.

Nevertheless, it should be remembered that the strong performance of generics has much to do with difficult economic conditions in recent years, with the shock of currency devaluation lifting demand for the drugs. While the sector is certain to increase the pharmaceutical sector's presence in Brazil, it is unclear whether the low-cost products will drive an increase in market value beyond that expected from the country's currently solid GDP growth.