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The global generic drugs market size is estimated to grow by USD 212.58 billion, at a CAGR of 7.86% between 2023 and 2028.
Pharmaceutical companies are increasingly turning to outsourcing as a strategic approach to optimize efficiency and control costs. By outsourcing, these companies can reduce financial risk by minimizing capital investments in laboratory equipment and land, converting fixed costs to variable costs, and leveraging the expertise of Contract Research Organizations (CROs). Pfizer, for example, has entered agreements with Aurobindo Pharma and Claris Life Sciences for contract manufacturing and generic drug outsourcing, respectively. This trend is expected to continue as more pharmaceutical companies seek to save time, mitigate risk, and cut costs in drug discovery and development processes. However, the lack of sufficient CROs can lead to weaker preclinical and early clinical capabilities, posing validation challenges and increasing the risk of compound failure. Therefore, outsourcing drug discovery and development activities remain vital for risk aversion and efficiency, driving market growth in the forecast period.
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The market share growth by the oral segment will be significant during the forecast period. The oral route of administration is the most commonly used. Oral administration is the ingestion of a drug through the mouth into the gastrointestinal tract. The oral drug delivery system market segment includes drugs that can be administered in the form of capsules, tablets, syrups, solutions, and suspensions.
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The oral segment was the largest segment and was valued at USD 222.28 billion in 2018. The growth of the segment is accelerating at a moderate pace due to the ease of usage and an increasing number of companies investing in research and development for oral treatment. For instance, Apotex (Apotex Inc.) is a Canadian pharmaceutical company providing affordable oral generic and innovative pharmaceuticals for patients globally. The advantages provided by the oral route, such as better availability, rapid drug delivery, and high efficacy, are further expected to propel the growth of the oral segment, which, in turn, will drive the growth of the market during the forecast period.
Generic drugs are copies of brand-name drugs that have the same dosage, intended use, side effects, and other pharmacological effects as brand-name drugs. Globally, the utilization of small-molecule generic drugs is on the rise due to their significantly lower costs compared to branded drugs. The expedited approval process for small-molecule generics, without the need for extensive animal and clinical studies, reduces both drug development time and research and development costs. This streamlined process fosters competition among generic companies, leading to market saturation and, subsequently lower drug prices. Moreover, the emergence of super generics, offering enhanced patient compliance and therapeutic efficacy, adds to their appeal. Key players like Viatris Inc., Novartis AG, Sun Pharmaceutical Industries Ltd., Teva Pharmaceutical Industries Ltd., and Cipla Ltd. offer small-molecule generics across various therapeutic areas. The increasing use and affordability of small-molecule generics are expected to fuel the expansion of generic drug portfolios and contribute to market growth during the forecast period.
A biosimilar is a biological product similar to an FDA-approved biological product, known as a reference product, and has no clinically meaningful difference in terms of the safety and effectiveness of the reference product. A reference drug is an approved drug product to which new generic versions of biosimilars are compared to show that they are bioequivalent to avoid significant variations among generic drugs and their brand-name counterparts. Further, one major factor leading to growing investments in biosimilars is the large market for reference products, especially for monoclonal antibodies that enable the entry of biosimilar manufacturers to the market. Companies such as PlantForm are using advanced technologies to create biosimilars; PlantForm has created a plant-based biosimilar version of Roches Herceptin. Therefore, plant-based biosimilars with reduced cost prices are anticipated to drive the growth of the market during the forecast period.
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North America is estimated to contribute 34% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional market trends and drivers that will shape the market during the forecast period. North America commands the market, with the US as its nucleus, housing major players like Merck and Co. Inc., Pfizer Inc., and Amgen Inc. These industry giants offer a diverse range of specialized products, influencing both physicians and patients. The region's growth stems from a surge in chronic diseases, attributed to lifestyle changes and heightened alcohol and tobacco consumption in the US. Canada witnesses rising biosimilar demand driven by increasing breast cancer cases.
In addition, generic drugs gain traction for their bioequivalence to branded counterparts, supported by associations like the Association for Accessible Medicines advocating for affordability. Government health initiatives like Medicare and Medicaid, coupled with Mexico's stringent quality standards, bolster confidence in generics. North America hosts key firms like Apotex Inc. and Pfizer Inc., fueling market expansion with extensive product offerings. The US and Canada lead in generic drug utilization, backed by robust regulatory frameworks ensuring safety and quality, fostering market growth during the forecast period.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market. The report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Amgen Inc.: The company offers a wide range of generic drugs such as Aimovig, Corlanor, Epogen, and Xgeva.
Abbott Laboratories, Amneal Pharmaceuticals Inc., Apotex Inc., Aspen Pharmacare Holdings Ltd, Aurobindo Pharma Ltd., Baxter International Inc., Biocon Ltd., Cadila Pharmaceuticals Ltd., Cipla Ltd., Dr Reddys Laboratories Ltd., Eli Lilly and Co., Endo International Plc, Fresenius SE and Co. KGaA, GlaxoSmithKline Plc, Hikma Pharmaceuticals Plc, Lupin Ltd., Merck and Co. Inc., Novartis AG, Pfizer Inc., PlantForm Corporation, Sanofi SA, STADA Arzneimittel AG, Sun Pharmaceutical Industries Ltd., Teva Pharmaceutical Industries Ltd., and Viatris Inc.
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market is being driven by various factors, including the increasing aging population, rising healthcare expenditure, and the growing prevalence of chronic diseases such as hypertension, asthma, and COPD. Additionally, initiatives like the Global RA Network and organizations like the American Lung Association are promoting awareness and accessibility to generic medications. However, challenges such as regulatory hurdles, competition from branded medicines, and the need for compliance with Abbreviated New Drug Application processes pose obstacles to market growth. Despite these challenges, the market continues to expand, driven by the demand for cost-effective alternatives to branded drugs. Our researchers analyzed the market research and growth data with 2023 as the base year, along with the key market growth analysis, trends, and challenges. A holistic analysis of drivers, trends, and challenges will help companies refine their marketing strategies to gain a competitive advantage.
Low-cost alternatives are notably driving market growth. The high cost of branded drugs leads to higher pharmacy costs resulting in high patient expenditure for such drugs. The high-cost factor, therefore, leads patients to opt for generic drugs as alternatives to expensive brand biologics such as Humira and Remicade for the treatment of autoimmune diseases and disorders like arthritis. Generic drugs also comprise identical active ingredients with similar strength, stability, purity, efficacy, and safety to the branded drug.
Further, the acceptance of generic drugs due to their low cost has also enabled emerging markets to avail of such drugs for treating various diseases. Therefore, the low cost of generics, their growing use in emerging markets, and their effectiveness lead people to opt for generic drugs, thereby contributing to the growth of the market during the forecast period.
Hospital-owned generics is an emerging trend shaping market growth. An increasing number of hospitals are consolidating to form generic pharmaceutical companies to address the problem of medications that are either in short supply or have undergone significant price hikes. The shortage of drugs is forcing hospitals to pay exorbitant prices to obtain drugs. The generic drug industry is unwarranted and arbitrary in terms of the prices they set for drugs and creates an artificial scarcity to make maximum profits. Thus, hospitals are forming consortiums to produce their generic drugs rather than relying on generic drug companies.
For instance, a consortium of five hospital organizations (US Department of Veterans Affairs, Ascension, SSM Health, Intermountain Healthcare, and Trinity Health), representing 450 hospitals and led by Intermountain Healthcare, has announced plans to establish a not-for-profit generic pharmaceutical company to address the problems of medication shortage and price hike of generic drugs. More hospitals are expected to manufacture their generics to reduce drug costs gradually. Thus, such factors are expected to drive market growth during the forecast period.
Increasing side effects is a significant challenge hindering market growth. Patients, hospitals, and researchers have also reported reduced efficacy and increased side effects in patients who consumed generic anti-seizure medications for epilepsy, such as levetiracetam, sold under the brand name Keppra. Adverse effects of generic drugs can vary for each patient, depending on his/her general health, stage of disease, age, weight, and gender, and can be mild, moderate, or severe. Mild adverse effects may be dry mouth, drowsiness, diarrhea, insomnia, and nausea, while serious effects can be suicidal thoughts, abnormal heart rhythms, internal bleeding, and cancer.
In addition, generic drugs such as lamotrigine, sold under the brand name Lamictal, for seizures have been reported to cause dizziness in patients. Such increasing side effects resulting from the use of generic drugs are leading patients to opt for brand-name drugs or other forms of treatment like surgery, thereby affecting the demand for generic drugs. Such factors are expected to limit the market growth during the forecast period.
The market forecasting report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth and forecasting strategies.
Customer Landscape
The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments.
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The market offers a wide array of affordable alternatives to branded medications, catering to various therapeutic applications such as cardiovascular, infectious diseases, and diabetes. For epileptic patients, medications like eslicarbazepine acetate provide effective treatment options. With advancements in pharmaceuticals, generic versions of drugs like generic ferumoxytol for iron deficiency anemia (IDA) and molnupiravir for infectious diseases are increasingly available. Companies like ANI Pharmaceuticals contribute to this market, ensuring the quality of oral generics and injection formulations. Hospital pharmacies and retail pharmacies play crucial roles in distributing medications like tiotropium bromide inhalation powder and tenofovir alafenamide tablets, enhancing access to affordable healthcare solutions for patients worldwide. The market encompasses a diverse range of pharmaceutical products, offering cost-effective alternatives to brand-name medications. With a focus on affordability and accessibility, generic drugs play a vital role in addressing various medical conditions, including hypertension, asthma, and COPD, among others. This market serves a broad demographic, including the geriatric population, who often rely on these medications for their healthcare needs.
Moreover, regulatory processes such as the Abbreviated New Drug Application facilitate the approval and availability of generic alternatives to branded medicines, ensuring a competitive landscape. Advancements in robotic process automation and artificial intelligence contribute to streamlining manufacturing processes and maintaining quality standards for intravenous drugs, steroids, and topical drug administration in conditions like psoriasis non-melanoma skin cancer, melanoma skin cancer and skin cancer. Further, the medicines Patent Pool (MPP) facilitates access to essential medications like Cystadane1, ensuring broader availability and affordability. RPA technology streamlines processes, enhancing efficiency in pharmaceutical manufacturing and distribution. Organizations like IARC contribute to monitoring and improving the quality of generic drugs, ensuring safety and efficacy. Obeticholic Acid Tablets address specific therapeutic application, offering effective treatment options. Surgeries often rely on generic medications for perioperative management, including drugs like Vemlidy Tablets. Breyna represents another example of a generic drug catering to various therapeutic needs, highlighting the diverse range of medications available in the market.
Market Scope |
|
Report Coverage |
Details |
Page number |
168 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 7.86% |
Market Growth 2024-2028 |
USD 212.58 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
6.62 |
Regional analysis |
North America, Europe, Asia, and Rest of World (ROW) |
Performing market contribution |
North America at 34% |
Key countries |
US, Germany, UK, China, and India |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Abbott Laboratories, Amgen Inc., Amneal Pharmaceuticals Inc., Apotex Inc., Aspen Pharmacare Holdings Ltd, Aurobindo Pharma Ltd., Baxter International Inc., Biocon Ltd., Cadila Pharmaceuticals Ltd., Cipla Ltd., Dr Reddys Laboratories Ltd., Eli Lilly and Co., Endo International Plc, Fresenius SE and Co. KGaA, GlaxoSmithKline Plc, Hikma Pharmaceuticals Plc, Lupin Ltd., Merck and Co. Inc., Novartis AG, Pfizer Inc., PlantForm Corporation, Sanofi SA, STADA Arzneimittel AG, Sun Pharmaceutical Industries Ltd., Teva Pharmaceutical Industries Ltd., and Viatris Inc. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the market forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Route of Administration
7 Market Segmentation by Type
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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