When we look at the number of ANDAs coming into the Office of Generic Drugs (OGD), one might stop to say, how can this be?  There has been so much M&A activity in the generic market, some would think that this might be a reason to see the number of submissions decrease or at least ebb, but that has not been the case.

When we look back at the passage of Hatch-Waxman Act in 1984, the US generics market was dominated by domestic players.  Now most of those domestic players are large multinationals that really don’t look or operate that same.  At the time of passage of that historic piece of legislation, India was just getting into the active pharmaceutical ingredient (API) market.  Soon the number of drug master files (DMFs) from Indian-based companies soared for those ingredients as the demand increased.  As time passed, the Indian finished dosage form market followed that trend and is now exploding. China was next on the API train and is now ramping up its US activity in the finished dosage form generic market.  There are some predictions that Chinese pharmaceutical companies could begin to significantly ramp up their ANDA filings.  There was a report in the news today that a Japanese firm is set to acquire Upsher-Smith Laboratories to increase its access to the generic drug market.  Also, per a recent report, a Korean firm is set to launch the first US generic finished dosage form from that country.  In addition, new smaller US generic companies are cropping up all with an eye on entry into the generics market.  So much for consolidation slowing the submissions of ANDAs!

I believe that the drug pricing controversy is also fueling a race to the ANDA submission line, as the newer players see an opportunity to help solve the problem of higher prices by entering the generic market and take a piece of the pie.  Higher generic prices also make room for smaller firms to capture a slice of that pie at a lower, but still profitable price.

While this might spell good news for the consumer in the long run, it may be an ominous sign for OGD.  If China, Korea, and Japan begin playing a bigger part in the generic market, this will further drive up the number of ANDA submissions.  Where will this leave OGD?  They are now facing a herculean challenge in dealing with the ever-increasing workload (which, by the way, is about 33% above what the projected workload would be).  How would a few more years with 1400 ANDA submissions impact OGD?  There is a lot riding on the success of the generic drug program and they have a lot of weight to carry.  We need to hope that their resources expand to meet their growing workload, especially, if the workload continues to increase.  As the Beatles song goes “Boy, you’re gonna carry that weight, carry that weight a long time.” Let’s hope that weight OGD has to carry does not become the straw that breaks the camel’s back.