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Author: JoelCairo Big gold star, 5000 posts Top Recommended Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 892  
Subject: Re: Generic Drug Manufactirers Date: 7/28/2004 11:45 AM
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Lower than what, the original pharma company that developed the drug? Sure, but that's a sunk cost and irrelevant for competing in the generic stage. Lower than another generic company after the 180 day window? Why would that be the case?

I was unclear. I meant: lower than the original pharma, since all they have to show is that they are making the same molecule, under the same manufacturing strictures. They don't have to do clinical trials.

As for six months, is it a little or a lot? I don't know. If I were number two, and had to sit on my thumbs for six months, I know I'd be pissed, and at a disadvantage.

My guess is that you can do quite a lot in six months to establish yourself as the preferred supplier of the generic. If the market is really sensitive to the potential cost savings -- meaning the HMOs, insurers, buying consortia, etc. all immediately jump on the generic to cut costs asap -- then perhaps one can make some real moolah in that six months, and have a leg up on other generics that does not immediately disipate, unless the next MeToo makes a significant move on price. I also wonder how quickly the Pharma responds to the lower price, because there is no doubt a residual effect from their just-ended monopoly that they would like to hold onto as long as possible.

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