They are called “aspirational strategies”, they deal with the issue of patent expiration and generic competition with the aim of maximizing the potential growth of a compound in the market.

Drugs based on small molecules can lose up to 90% of the market share of the brand just a year after the entry of generic products at a lower price, says the report by Arthur D. Little “The big patent expiry question : Why sink when you can sail? “. But what appears to be an inescapable event could actually present very interesting growth opportunities for the future, if we look at the problem pro-actively and from a positive perspective.

The strategies at the expiry of the patent

“The impact on the company of a Loe strategy (Loss of exclusivity) can be assessed using the turnovers as one of the key indicators. Traditional Loe strategies are usually chosen and designed to prevent the rapid decline of revenues, with a success that is achieved if this decline is slow. The aspirational strategies are instead designed to achieve growth, so that success is achieved if you have a turnover increase over time”explains Fabrizio Arena, partner and Head of Healthcare & Life Sciences of Arthur D. Little Italy.

How to maintain growth potential

There is no aspirational strategy that is valid for all cases, each product and therapeutic area must be approached in a specific way. “Ideally, the process of tackling the problem of patenting an active ingredient should start midway through the product cycle growth phase, usually three to four years after launch,” explains Principal Healthcare of Arthur D. Little UK Ben Enejo.

Identification of targets

The companies that hold the intellectual property rights of the expiring active ingredient have many options to draw from, including the development of their own generic version or branded generics of the product, or the modification of its characteristics in order to protect new indications, formulations or methods of administration. “If the objective is to maintain the market share, the situation of the same must be analyzed to verify how this can be achieved. The aspirational strategies are more suitable for producing turnover and profit growth. The financial and market evaluation is part of the development of the business case, which must be made thanks to inputs along the entire value chain of the drug”, explains Emmanuel Aisabokhae, Healthcare & Life Sciences manager of Arthur D. Little UK.

Attention to unexpected needs

The areas of clinical need expressed by physicians, patients, caregivers and payers are among the most interesting objectives for a Loe strategy, which could involve even minor changes to the product whose patent is nearing expiry. In fact, these targets can also provide new opportunities for expanding the company’s portfolio.