Powerful, disruptive forces are upending the European generics industry and shifting the center of gravity away from standard drugs. Read the full report, here: http://on.bcg.com/1uhI5mA

1. From 2014 through 2020, two-thirds of drugs losing patent protection
(measured in terms of sales in euros) will be specialty drugs and biologics.
DISRUPTION HITSThe Generic-Drug Industry in Europe
Generics industry
fragmentation
Unprecedented
price pressure
Increasingly powerful
distributors and
pharmacy chains
Barriers to growth
of generics including
stiff competition
from originators
The pressure is unlikely to let up – 4 forces
are weighing on the industry
In the 6 markets we studied, 70% of generics industry profits will
come from specialty drugs and biosimilars in 2020, up from 51% in 2012.
The center of gravity is shifting from standard generics
to specialty drugs and biosimilars
%
in 
Spain
UK
Germany
Pola
nd
Italy
France
%
in 
The median return on capital for 8 leading U.S. and European generics
players fell from 7.5% in 2011 to 6.7% in 2013. At these levels, returns
are not covering the industry’s estimated cost of capital of around 9%.
This shift will take place amid a challenging environment
.
%
%
in 
in 
.
PATENT PATENT
PATENT
The specialty drug and biosimilar segments are growing rapidly
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