Canadian internet pharmacy sales to the United States down 50% in 2006 - First Canadian generic manufacturer to hit $1 billion in sales

    MONTREAL, March 21 /CNW Telbec/ - Year-end data released today by
IMS Health, the world's leading provider of market intelligence to the
pharmaceutical and healthcare industries, shows that Canadian internet
pharmacy sales to the United States dropped sharply in 2006 compared to 2005.
    While 2005 sales to the U.S. recorded by Canadian internet pharmacies
reached $420 million, 2006 sales declined by almost 50% to reach $211 million.
Declining sales have now been observed for every quarter since June 2004.
While internet pharmacies sold more than $121 million to the U.S. in the first
quarter of 2005, they made shipments worth just above $40 million in the last
quarter of 2006.
    "Just a few years ago, internet sales of prescription drugs to the United
States were booming. This is no longer the case due to a number of factors,"
says Ian Therriault, IMS Health Canada's senior industry expert. "Among them,
the Canadian exchange rate is not as favorable for U.S. citizens as it once
was. In addition, manufacturers implemented supply restriction initiatives and
a new Medicare prescription plan was introduced in the U.S. extending coverage
to uninsured and underinsured Americans. Negative press coverage around
counterfeit and foreign drugs entering the U.S. market may also have played a
role in dampening sales," explains Mr. Therriault. Pending legislation in the
U.S. aimed at allowing drug imports may change this declining trend, adds
Mr. Therriault.

    First generic manufacturer to hit $1 billion mark

    Ontario-based Apotex became the first generic drug manufacturer to reach
sales of more than $1 billion in Canada. With drugstore and hospital purchases
of $1.1 billion, it is now the fourth largest pharmaceutical manufacturer in
Canada behind brand-name companies Johnson & Johnson ($1.121 billion)
AstraZeneca ($1.172 billion) and Pfizer ($2.397 billion). Sales of generic
medication grew 13.6% in 2006, twice the rate of branded sales.
    As more patents are expected to expire over the coming years, the generic
industry is poised to benefit. In 2007 over $1 billion in branded sales will
likely be exposed to generic competition. Expected losses coming from patent
expiries was a major reason cited for the layoffs announced by some of the
industry's biggest brand-name companies this year.
    The 10 leading pharmaceutical companies in Canada accounted for close to
$10 billion in purchases in 2006, which represented 56% of the total market.
    In 2006, the total prescription pharmaceutical market was $17.8 billion
(drugstore and hospitals purchases), up 7.9% from 2005. Driving growth last
year were oncology medications, such as Herceptin and Rituxan, and a rebound
by classes affected by safety concerns - SSRIs, COX-2s and major

    Brand-name industry records significant growth

    After going through a year of declining prescription growth in 2005, the
number of prescriptions for brand-name products went up 1.1% to 4.3% in 2006.
This is the strongest performance by the brand-name industry since 2003.
    Among brand-name manufacturers, Roche experienced the strongest growth in
sales with an increase of 27.7% in Canada. Sales at Roche surpassed
$600 million in 2006, allowing the manufacturer to become one of the top 10
pharmaceutical companies in Canada. This significant increase is mainly due to
the performance of cancer medications Herceptin and Rituxan. Oncology drugs
were the fastest growing among Canada's top selling classes in 2006, growing
almost 20% to reach $871 million.
    The total number of prescriptions, including both generic and brand-name
products, increased 6.8% to 422.6 million.
    Among new molecular entities (NME), only three reached more than
$1 million in sales in 2006. They are diabetes medication Levemir (Novo
Nordisk) with $12.3 million, Gardasil for the human papillomavirus (Merck
Frosst) with $1.9 million and Sutent (Pfizer) (for stomach and intestinal
cancer) with $1.8 million. There were 22 new molecular entities (NMEs)
approved by Health Canada last year, a marked decrease from 35 NMEs approved
in 1999.
    "Looking out to 2010, the Canadian market is forecasted to grow at an
average annual growth rate of 7.5%, reaching $23.4 billion," says
Mr. Therriault. "Despite generic competition and cost-containment measures by
public drug plans, growth in the industry will be sustained by oncology,
specialty products, such as biological response modifiers, and plans for a
national catastrophic drug coverage program."
    (Please view IMS tables detailing 2006 Canadian pharmaceutical market
performance at

    About IMS Health

    Operating in more than 100 countries, IMS Health is the world's leading
provider of market intelligence to pharmaceutical and health-care industries.
With $2 billion in revenue in 2006 and more than 50 years of industry
experience, IMS offers leading-edge business intelligence products and
services that are integral to clients' day-to-day operations, including
portfolio optimization capabilities; launch and brand management solutions;
sales force effectiveness innovations; managed care and over-the-counter
offerings; and consulting and services solutions that improve ROI and the
delivery of quality healthcare worldwide. IMS information is also used by
researchers, academics, government and other stakeholders to advance health
through informed decision-making. Additional information is available at

For further information:

For further information: Sue Cavallucci, Manager, Media Relations, IMS
Health Canada, (514) 428-6056

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