Cipla Ltd, a domestic pharmaceutical major, is set to tap the European inhaler market with generic drug launches in those markets. The company, with its product pipeline of 11 products, is mainly targeting a smaller pie of the blockbuster drug Seretide—a $2.5-billion product.
The respiratory market worldwide is estimated at $34 bilion, according to 2010 sales. The major markets in the US and European Union account for more than 80 per cent of the total global respiratory market.
S Radhakrishnan, CFO, Cipla, said, "We have a market share of 70 per cent in the inhalation therapy segment in India. Given our technical strengths and expertise in this area, it is imperative for us to leverage these strengths not only in Europe but also in rest of the world."
Cipla is expected to launch Seretide (sold as Advair in the US) in the EU market by the middle of the financial year 2013. With about 60 to 70 per cent erosion and a 15 to 20 per cent revenue share, Cipla can earn revenue of about $200 million in the first couple of years, say analysts.
Radhakrishnan did not disclose details on revenue expectation. He said, "The growth and revenues would depend on the completion of clinical trials and regulatory approvals, but we are optimistic that some of the products will be commercialised in the next two to three years in Europe. Given the sensitivity of the information, we may not be able to give product-wise details."
Cipla has already received approval for four products (Budesonide, Salbutamol, Salmeterol and Salmeterol/Fluticasone Combination) and is awaiting regulatory nod for another seven.
However, experts believe there is nothing to cheer for Cipla on launching the generics in Europe, where the company has no strong presence. Deepak Malik of Emkay Global said, "There is still an uncertainty on whether Cipla will launch generic or branded products and that by their own or in partnership. As Cipla has no strong front-end in EU, revenue will have to be shared with partners. In that case, Cipla will never earn any significant chunk of revenue."
About 10 to 12 generic players, including Teva, Mylan and Sandoz are in race for generic Seretide launch in Europe. As part of seeking marketing approval, Cipla's marketing partner in EU-Neolab has challenged the patent of Seretide in Germany.
"Competition will be very intense as 10-11 players are already lined up with four to five players with their own brands such as Teva and Mylan. It will not be easy for Cipla and success will depend on the right partner," Malik added.
Cipla, which has tied up with Swedish Co, Meda AB, for marketing a few inhaler products, is exploring new alliances in the European markets.
Meda AB's new drug application (NDA) for a combination inhaler branded Dymista (azelastine and fluticasone) for allergic rhinitis is likely to be approved by the middle of this year. Cipla is the manufacturing partner of Meda for this product. The global market size for azelastine is $250 million, while that for fluticasone is $350 million, according to an ICICI Securities report.
However, Cipla has no immediate plans to enter the US market for inhalers. Radhakrishnan said, "Regarding the US market, Cipla would explore all options, including filing its own abbreviated new drug applications (ANDAs). This is however, still a few years away, given the complexity of the regulatory process."
