Report Predicts Generics Production Return to US

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Concerns about quality in overseas production may bring generic drug production back to the United States, concludes CPhI study.

A new report, CPhI Pharma Insights USA, concludes that the US market remains the most dynamic pharmaceutical economy in the world and that structural changes are presenting new and contrasting opportunities.

Conducted among all major domestic manufacturers and key international companies, the report examines domestic perceptions of the market and how these perspectives contrast with international organizations investing in the United States. CPhI Worldwide and InformEx jointly developed the report.

For US-based pharmaceutical companies, a key trend is the repatriation of generic production, with increased investment opportunities and imminent acquisitions taking place predominantly overseas: 12.5% are undertaking a domestic acquisition with a further 25% internationally. However, 30% of international companies are principally looking for acquisitions within the US. This suggests that domestic firms are looking for international sites to lower manufacturing costs, while overseas firms require a domestic base from which to fully penetrate the regional healthcare economy.

More than 70% of domestic respondents forecast growth in domestic production of generics­­­, a trend that goes against recent history and natural outsourcing economics, the report says. This dynamic is the result of rising concern about the safety of generics produced overseas, which is providing a path for generics production to return to the US, particularly for off-patent prescription drugs and branded OTC products, the report concludes.


Surprisingly, over 75% of US respondents do not perceive drugs manufactured in the US as any safer than those produced in the EU, while more than 50% of of the respondents from international firms view US production far more positively, according to the report.

The report concludes that the key aspects to continuous growth and success in the US pharma market are its technical capabilities as well as its mature regulatory and intellectual property guidelines. These factors continue to attract the world’s biggest and most innovative pharma companies, providing a safe place to undertake research and investment with the ultimate goal of selling backed by a stable and profitable economy.

Source: CPhI