Overcoming the patent cliff the role of packaging in enterprises' response to industry competition
release date: Source: China Packaging editor: Sean M. Riley Views: 2213 copyright and disclaimer
core tip: in the past two decades, the demand for non patented drugs in the United States has tripled. With the expiration of brand drug patents, non patented drugs can enter the market. The market of the pharmaceutical industry
[China Packaging News] in the past two decades, the demand for non patented drugs in the United States has tripled. With the expiration of brand drug patents, non patented drugs can enter the market. The market competition in the pharmaceutical industry is becoming increasingly fierce, and the efficiency and cost saving in the manufacturing process are becoming more and more important
the patent protection of drugs in the United States usually lasts for 20 years, and then the patent owner faces the so-called "patent cliff" - when the drug patents expire, the sales volume drops significantly, and the income is inevitably difficult to maintain. Generally, once the patent expires, non patented drugs will enter the market, and their costs will be reduced by 80%-85% on average compared with brand drugs. Although this practice usually has a negative impact on the total revenue of the pharmaceutical industry, it benefits patients by providing proven drugs at a lower price. In fact, generic drugs currently account for 88% of all OTC drugs issued in the United States, while their costs account for only 28%
the profit margin of generic drug manufacturers is far lower than that of the copied brand drugs. Therefore, generic drug manufacturers must keep lean operations as far as possible to make profits. For brand pharmaceutical companies, the higher profit margin is obtained within the whole validity period of the patent. The starting date of the patent protection period for branded drugs is the date when the drugs are submitted to the United States Patent and Trademark Office (USPTO). However, it still needs about a decade of clinical trials to test the efficacy and safety of drugs before they are approved by the food and Drug Administration (FDA). This process often results in only seven to twelve years remaining in the valid patent period. In addition, 95% of drugs will fail in the development process, and only 20% can recover the R & D cost. Therefore, the experimental data and curves are automatically saved; It is important for patent owners to operate as efficiently as possible during the patent validity period to earn back the investment cost
manufacturers of branded drugs and generic drugs - due to their fierce competition with each other - attach great importance to technologies that can improve efficiency and reduce drug production costs. The industry has been focusing on new trends and technologies - such as integrated machines, flexible feeding technology, nest filling solutions and packaging improvements. Pharmaceutical professionals will see the above and more innovations at the pharmaceutical Expo (Chicago McCormick Exhibition Center, November 6-9) and 2016 International Packaging Machinery Expo. The pharmaceutical Expo is jointly organized by PMMI American Packaging Machinery Manufacturing Association and International Pharmaceutical Engineering Association (ISPE)
integrated machine design and flexible feeding
uhlmann packaging systems sales manager Sabri Demirel said that the patent cliff makes enterprises more interested in lean machines that are cost competitive, occupy less space and convert faster. "Pharmaceutical companies, especially generic drug companies, are cost driven," Demirel said. "Therefore, each party hopes to achieve a higher profit margin by improving the efficiency of processing and packaging equipment."
one of the best ways to improve efficiency in this field is to integrate machine design. The overall design of integrating multiple units into one platform can save space and expand output. "In the past, manufacturers needed one machine, one conveyor, and another machine and another conveyor. The number of machines needed would determine the length of the production line," Demirel explained. "Now, we can integrate multiple machines into one platform. One of our most popular integrations, IBC 120, is 20% more efficient than a combination of individual components on average."
another key factor to improve efficiency is related to product conversion. "Some generic drug manufacturers offer hundreds of different shapes," Demirel said. "Flexible feeding technology can handle a wide range of products and does not require conversion when running each new product."
demirel pointed out that Uhlmann's Blister Express Center (BEC) 300 has the largest demand, which can integrate blister packaging machine and paperboard packaging machine modules into the same unit. "In particular, generic drug manufacturers are more interested in BEC 300 because the price of this product is very competitive, which can be used for small batch and conversion within 3 days and 30 minutes," he said
nest filling solution Randy fraatz, business development manager of Mg America, pointed out that branded drug manufacturers and generic drug manufacturers are also turning to a new packaging trend that can improve efficiency - nest commodity filling. Containers - such as vials, cartridges, and syringes - are delivered to the manufacturer in nest or matrix packaging, rather than in general loose batch form. "This trend has evolved from syringes to vials and now to cartridges," fraatz said
the containers are delivered from the supplier in the form of refillable (RTF) after pre disinfection, so that the pharmaceutical manufacturer does not need to use the cleaning machine and pyrogen removal pipeline during operation. "100 syringes were delivered in nested RTFS," fraatz explained. "The syringe can then go directly into the filling and blocking device and remain nested during the filling of the syringe and the use of the blocking device. This system is a very effective container handling and filling method."
this process requires a new method to introduce nested containers, because the traditional filling machine design can only handle batch or bulk containers transferred back to the turntable. "We see the industry increasingly investing in machinery and systems that can handle nested goods," fraatz said. "This affects the focus of our research and development and the types of machines we invest in from a design perspective."
however, fraatz points out that the decision to move to a nested solution must be based on a complex financial analysis that includes multiple factors. Nested containers delivered in RTF are more expensive than bulk containers to be cleaned delivered in pallets. The cost must be weighed against the cost savings of the cleaning machine and the pyrogen removal channel, including the floor space required to operate each equipment. Pharmaceutical companies must also consider which drugs are in their portfolios and pipelines, and what type of processing flexibility their equipment will require. "Every project is unique," fraatz points out. "Because we offer two solutions, we can work with our customers to calculate which method is the least costly and can best meet their unique requirements as a whole."
packaging innovation in the pharmaceutical industry mainly focuses on product safety, patient compliance with medical orders and cost. "One of the main differences between drug packaging and consumer goods packaging (CPG) is that the purchase of prescription drugs is decided by doctors in the special plan for the development of new materials industry in Shandong Province (2018-2022), rather than consumers," said Jerry Martin, consultant of PMMI medicine and life sciences. "Doctors are mainly concerned about the compliance and efficacy of patients' medical orders."
in addition, Anna frolova Levi, vice president of bilcare research Inc., pointed out that even for over-the-counter drugs (OTC) - accounting for 8% of drug sales in the United States - the convenience of packaging is not as important as drug safety and tamper resistance. "The authenticity of drugs is very important, and it is equally important to prove that the packaging has not been opened," frolova Levi explained. "In addition, with the non patented drugs becoming the drug category after several repeated experiments, the overall competition in the pharmaceutical market has reached the peak, and cost control will become the main consideration of packaging." Packaging innovation and form change can reduce costs, so today's pharmaceutical industry attaches great importance to these innovations
many pharmaceutical manufacturers hope to use flexible packaging to reduce costs because it is lighter and more compact than hard packaging. In fact, pharmaceutical packaging is the fastest growing market segment in the flexible packaging market, with a CAGR of 7.1% from 2013 to 2018
a recent innovation is child-guardtm (child protective packaging) from Presto products company, which can help pharmaceutical manufacturers make good use of flexible packaging. The solution is an enhanced version of the child protection test program that has been developed through the anti poison Packaging Act (PPPA). This innovation can be applied to bulk drug flexible packaging bags, and can also be used as a novel variant of traditional blister packaging
"this packaging form enables generic and branded drug manufacturers to apply flexible packaging - attractive in terms of cost reduction - to pharmaceutical products that are required by regulations to protect children," said Richard Custer, commercial director of Presto products specialty division
overcoming the patent cliff
"there is a patent cliff every day," Martin said. "And the patent cliff will continue to appear every day in the future. This is the essence of the industry." With the increasingly fierce competition in the pharmaceutical environment, manufacturers need to always be in the leading position and find solutions suitable for their operation
the participants of 2016 International Packaging Machinery Expo and pharmaceutical Expo will have the opportunity to witness the latest solutions in person. The exhibition also provides participants with an opportunity to have in-depth exchanges with suppliers to fully understand the advantages and disadvantages of different technologies. "
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