Teva Doubles Production as Japanese Change Attitude to Generics

By Dan Stanton

- Last updated on GMT

Teva to benefit from changing Japanese attitudes
Teva to benefit from changing Japanese attitudes

Related tags: Generic drug

Teva says it will reap the benefits of changing attitudes to generic drugs in Japan as it doubles its production capacity in the country.

Spokeswoman Denise Bradley told the Japanese generic drug market is one of Teva’s growth targets, explaining that: “We will be looking at the strategic rationale for product development and deployment.”

The expansion plan – which will see Teva plough ¥20bn ($200m) into new manufacturing capacity according to a Reuters’ report​ – contrasts with the firm’s earlier efforts in the country where the “the strong brand culture of Japanese people”​ had previously put it off making such investments according to Bradley.

 “As the socio-economic conditions in Japan continue to change [especially due to current market conditions], so does the belief that price equals quality.” 

“People are looking for lower cost items that have good quality,”​ added Bradley. “This is where Teva can and will have an advantage.”

Teva currently has five manufacturing sites in Japan, at Takayama (Teva’s second largest facility worldwide), Kasukabe, Koka and two in Nagoya.

Turning Japanese

The expansion is in keeping with policy set out in Teva’s 2012 end-of-year report​ in which the company discussed its increasing presence in key markets, including Japan. As for manufacturing in the country, Teva intends to increase production to 8-9bn tablets by 2018.

To do this, Teva has been pursuing an active acquisition strategy with Japan’s third largest generic firm, Taiyo Pharmaceuticals, being purchased in 2011 for $460m​. A second acquisition of Taisho Pharmaceuticals followed later that year, and – following on from a joint venture set up in 2008​ – the company also bought out Kowa Company​.

Since 2012, all Teva’s Japanese subsidiaries have operated under one company, Teva Seiyaku.

According to the report, the generics market is in the process of consolidation, and though competition is increasing with an increased presence of both global and local companies, “the four leading generic pharmaceutical companies now capture approximately 50% of the market”

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