Teva Ends Hoechst's Generics Misery

Teva Pharmaceuticals is buying Copley Pharmaceutical, another demonstratiion of brand-name companies' disappointment in generics as a business. Hoechst paid more than $500 million for Copley, which it bought in the heyday of brand-name companies' infatuation with the strategy of getting into the generics business in order to ward off fierce generics competition when key branded drugs go off patent. But Copley ran into regulatory problems above and beyond a flawed strategy. Teva, on the other hand, becomes the biggest US maker of generic pharmaceuticals in terms of volume, although Mylan is still slightly ahead in terms of revenues. This comes at a time when size is a key ingredient for success in generics due to the commodity-like nature of the business and customer consolidation.