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Actavis Focuses on Complex Generics and Para IV Filings

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Focus on complex generics

Actavis (ACT) focuses on developing generic products in the US that are difficult to formulate or manufacture, or that complement or broaden its existing product lines. These include discovering new delivery mechanisms and dosages for existing brand-name drugs, such as a birth-control patch that uses lower doses of hormones.

This is a niche with the potential to generate revenues of ~$50 million–$100 million. Also, Actavis is focusing on the development of biosimilars and products with different dosages from technologies such as:

  • inhalation
  • complex injectables
  • transdermals
  • ophthalmic suspensions
  • topical creams, ointments, and gels

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New product portfolio

In January 2015, Actavis launched a generic specialty injectable portfolio, containing ~20 products across its therapeutic segments in the US. Also, the company has a strong injectable pipeline with ~20 new filings that are under consideration and more than 50 projects that are in development.

Other leading companies such as Teva (TEVA), Mallinckrodt (MNK), and Hospira (HSP) are the direct competitors of Actavis in the complex generics market.

Focus on Para IV filings

Actavis had more than 200 Abbreviated New Drug Applications (or ANDAs) on file in the US in fiscal 2014. Also, it is one of the leading companies in first-to-file (or FTF) performance, evident from an increasing number of FTFs. In 2012, the company had 12 FTFs, which increased to 18 in 2013 and again to 25 in 2014.

However, these 25 FTFs also included eight shared FTFs, and 17 were exclusive FTFs. In 2014, Actavis’s share of the industry’s FTFs was ~33% in terms of the percentage of products. The company had ~46% in terms of dollar value: $6.1 billion in 2014, $4.1 billion in 2013, and $2.3 billion in 2012.

The profitability of the generics business can be exploited through investing in pharmaceutical ETFs like the Health Care Select Sector SPDR Fund (XLV) and the iShares USA Healthcare ETF (IYH).

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