Healthy trend: Indian pharma firms see rise in USFDA drug approvals in FY18

Ahmedabad-headquartered Cadila Healthcare has received the largest number of approvals, at 76, so far in FY18

As FY18 enters its final quarter, a look at formulation approvals by the US Food and Drug Administration (FDA) in the year till date (YTD) period shows an improvement over the last year.

Deepak Malik, associate director at Edelweiss Securities, says that 750-800 approvals had come in 2016-17. In 2017-18, around 1,000 abbreviated new drug applications (ANDAs) to FDA are likely to get approval. "So far, around 700 or so approvals have come for ANDAs, and the last quarter is expected to see another 300 or so," he said. 

Of the major companies that sell drugs in that country, Ahmedabad-headquartered Cadila Healthcare (Zydus) has received the largest number of approvals, at 76, so far in FY18. There were only 14 approvals for the company in all of FY17. 

Aurobindo Pharma had done well in FY17, securing 73 approvals, followed by Actavis at 40.

The previous financial year had seen Sun Pharmaceutical, this country's largest drug major by valuation, launch generic cancer drug Gleevec that had boosted its profit for the April-June quarter to Rs 20.3 billion (up from Rs 5.6 billion in the year-ago period). However, its 180-day exclusivity period for the generic leukaemia drug ended in July 2016.

Sun got 21 approvals in all of FY17. So far this year, it has again received 21. 

The blockbuster drug in FY18 was from Cadila/Zydus. It had commercially launched an ulcerative colitis drug generic, Lialda, in the US market in July 2017 from its Moraiya facility near Ahmedabad. It was the first to file an ANDA for the generic version and this is the only generic available to patients in the US. However, the market is abuzz that innovator company Shire is preparing to launch an authorised generic version of the drug in the US market soon.

Analysts predict that three broad trends would create ripples in the US market in 2018. These being elections and drug pricing issues, faster approvals by the FDA (including for complex products) and consolidation, with a heightened merger-acquisition drive.

Malik says, "The drug pricing issue took a back seat to Obamacare in 2017 but is likely to re-emerge as a key political theme ahead of the 2018 US midterm elections in November when the Democrats hope to regain control of Congress (the legislature). The Congress doesn't support giving CMS (the entity in charge of medical aid programmes there) the price negotiating authority on sourcing of medicines. It is instead trying to get competing or generic drugs to market faster, to drive down prices. So, we will continue to see an increase in approvals by the FDA, leading to an increase in competition. What will be noteworthy is faster approvals of complex products like Copaxone, Nuvaring, transdermals, Lupron Depot, and Lansaprazole ODT."