Abstract
Canada represents one of the largest markets for pharmaceuticals in the world,
with a huge potential for generics. In 2008, generics accounted for more than
51% prescriptions and around 23% sales of the total pharmaceutical market. The
Canadian generics market is benefitting from several factors such as patent
expiry of several blockbuster drugs, lower costs, cost containment measures by
the government and rapidly ageing population, according to "Generic Drug
Market in Canada", a comprehensive market research report by RNCOS.
The report thoroughly evaluates factors that distinguish Canada from other
generics markets both in positive and negative ways. A major factor that
differentiates the Canadian generics market from the US and most European
markets is comparatively higher prices of generics and lower price erosion. As
this characteristic of the market allows manufacturers to fetch better margins
from their drugs, many foreign players have shown keen interest to enter the
Canadian generics market to make most of this lucrative characteristic.
At present, drugs to treat chronic diseases account for most of the
pharmaceutical market, with cardiovascular drugs holding the top spot.
However, strong growth is expected in other chronic segments, particularly in
cancer and diabetes.
Although the Canadian generics market has huge growth potential, recent
government regulations and various other challenges can significantly hamper
the development of the market. However, low cost of generics and billion
dollar drug patent expiries will enable the generics market to continue its
double-digit growth in the next five years.
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