GSK's Witty opts out of generics market

When it comes to diversifying through generics, count GlaxoSmithKline out. CEO Andrew Witty says he has no interest in duking it out in that marketplace. Not only does generics success depends on low production costs, but also on a sort of street-fighting aggressiveness in challenging other people's patents. If you're first to the party with a drug, you get 180-day exclusivity, which is lucrative, but after that returns drop significantly--and who's always first to every party? "I think it's a tough world to play in," Witty told the Wall Street Journal Health Blog. "We've got far better ways we can create value."

It may be a tough market, but because generics sales are growing at a faster clip than branded meds are, several blue-chip drugmakers have been beefing up their generics ops. Sanofi-Aventis is looking to buy the three-quarters interest in Czech generics maker Zentiva it doesn't own already, for instance, and Daiichi Sankyo is snapping up a majority stake in India's Ranbaxy. But Witty would rather diversify through vaccines and over-the-counter sales, and, of course, in emerging markets. And Witty isn't alone, the Health Blog notes; Roche CEO Severin Schwan isn't big on the generics biz, either.

- see the Health Blog item

ALSO: Witty has seen the future of drug development, and government healthcare systems will play an even bigger role in it. In an interview with the Wall Street Journal, Witty says that the pharma giant will give government agencies around the world--which pay the lion's share of the drug tab--a bigger voice in deciding which new therapies are advanced in the pipeline. Report

PLUS: GlaxoSmithKline is making ambitious plans to expand its R&D operations in China. Report