Low pricing has always been something of a double-edged sword for the generics industry. While offering cheaper alternatives to branded products and allowing expanded access to medicines are fundamental components of the off-patent sector’s value proposition, heavy price pressures can create an environment in which generics businesses operating on already thin margins are simply no longer sustainable. This can threaten to force certain products or suppliers out of the market entirely, reducing competition rather than enhancing it.
The generics industry – especially in the US where a limited number of buyers control much of the market – has tended to see this tension express itself as a cycle of rising and receding pricing pressures, where intense periods of severe