West-Ward Pharmaceuticals, now known as Hikma Pharmaceuticals USA, has established itself as a significant player in the US pharmaceutical market. This analysis delves into the company's market position, strengths, and strategic insights, providing valuable information for industry professionals and stakeholders.
Company Overview
West-Ward Pharmaceuticals, founded in 1946, has evolved into a major generic pharmaceutical manufacturer in the United States[1]. In 2018, the company rebranded as Hikma Pharmaceuticals USA, aligning with its parent company, London-based Hikma Pharmaceuticals[3]. This rebranding effort reflects the company's commitment to global growth and recognition.
Market Position
West-Ward/Hikma has secured a strong position in the US pharmaceutical market, particularly in the generics and injectables segments. As of 2014, West-Ward represented 51% of Hikma's group sales, highlighting the importance of the US market to the parent company[1]. The company's strategic acquisitions and expansions have further solidified its market presence.
Injectable Market Leadership
West-Ward became the second largest injectable supplier by volume in the U.S. after the acquisition of Baxter's Multi-Source Injectables (MSI) division in 2011[1].
This acquisition, along with subsequent ones, has positioned West-Ward/Hikma as a formidable player in the injectable pharmaceuticals market.
Generics Business Growth
The acquisition of West-Ward Columbus in 2016 significantly transformed the company's generics business. This move expanded the product portfolio and manufacturing capabilities, setting the stage for future growth[2].
Product Portfolio
West-Ward/Hikma boasts a diverse product portfolio spanning multiple therapeutic areas:
Oral Solid Generics
The company offers 41 oral products in 103 dosage forms, including popular medications like Doxycycline, Amoxicillin, and Prednisone[1].
Injectable Products
With 65 products in 184 dosage forms and strengths, the injectable portfolio includes critical medications such as Fentanyl, Morphine, Phenylephrine, Glycopyrrolate, and Argatroban[1].
Branded Products
While primarily focused on generics in the US market, the company also maintains a strong branded presence in the Middle East and North Africa (MENA) region[2].
Manufacturing Capabilities
West-Ward/Hikma's manufacturing capabilities are a key strength:
US Facilities
The company operates FDA-approved manufacturing facilities in the US, including a significant presence in Columbus, Ohio[4].
Global Manufacturing Network
With facilities in Portugal, Jordan, Saudi Arabia, and Germany, West-Ward/Hikma has expanded its capacity to produce quality pharmaceuticals globally[1].
Strategic Acquisitions and Partnerships
West-Ward/Hikma's growth strategy has heavily relied on strategic acquisitions and partnerships:
Baxter's MSI Division
The 2011 acquisition of Baxter's Multi-Source Injectables division significantly boosted the company's injectable portfolio[1].
Bedford Laboratories
In 2014, the acquisition of Bedford Laboratories' assets further strengthened the injectable product line[1].
Boehringer Ingelheim
The company has maintained a strategic relationship with Boehringer Ingelheim, including contract manufacturing arrangements[6].
Takeda Partnership
In 2017, West-Ward/Hikma expanded its licensing and distribution agreement with Takeda, adding attractive branded products to its MENA portfolio[6].
Financial Performance
Understanding the company's financial performance provides insights into its market strength and growth potential:
Revenue Growth
In 2016, the Generics business, which includes West-Ward operations, reported revenue of $604 million, up from $151 million in 2015[2].
Profitability Challenges
Despite revenue growth, the company faced profitability challenges in the Generics segment, with core operating profit declining from $46 million in 2015 to $35 million in 2016[2].
Market Headwinds
The company has faced significant industry headwinds, including customer consolidation and increased competition due to a rise in generic drug approvals by the US FDA[6].
Research and Development
West-Ward/Hikma's commitment to R&D is evident in its product pipeline and innovation efforts:
Generic Advair Development
The company has invested in developing a generic version of Advair Diskus®, demonstrating its focus on complex generics[6].
New Product Launches
In 2016 alone, the Branded business launched 109 products in different dosages and strengths across all markets, including 19 new products[2].
Market Challenges and Opportunities
The pharmaceutical landscape presents both challenges and opportunities for West-Ward/Hikma:
Price Erosion
The generics market has experienced significant price erosion due to increased competition and customer consolidation[6].
Regulatory Environment
An increase in generic drug approvals by the US FDA has intensified competition in the market[6].
Growth in MENA Region
The company's strong performance in key markets like Algeria and Egypt presents opportunities for continued growth in the MENA region[2].
Future Outlook
West-Ward/Hikma's future strategies focus on navigating market challenges while capitalizing on growth opportunities:
Injectables Growth
The company expects continued growth in its Injectables business, driven by strong demand and new product launches[2].
Generics Turnaround
Efforts are underway to improve the performance of the Generics business through new commercial opportunities and pipeline execution[6].
Cost Optimization
The company is actively identifying cost savings opportunities, particularly in the Generics business[6].
Competitive Advantages
Several factors contribute to West-Ward/Hikma's competitive edge in the pharmaceutical market:
Diverse Product Portfolio
The company's broad range of products across multiple therapeutic areas provides resilience against market fluctuations.
Strong Manufacturing Capabilities
With FDA-approved facilities in the US and a global manufacturing network, the company can ensure consistent supply and quality.
Strategic Geographic Presence
The strong presence in both the US and MENA markets allows for diversified revenue streams and growth opportunities.
Key Takeaways
- West-Ward Pharmaceuticals, now Hikma Pharmaceuticals USA, has established a strong presence in the US generics and injectables markets.
- Strategic acquisitions have played a crucial role in the company's growth, particularly in the injectables segment.
- The company faces challenges in the generics market due to price erosion and increased competition but continues to focus on new product development and cost optimization.
- A diverse product portfolio and strong manufacturing capabilities provide competitive advantages.
- Future growth strategies include expanding the injectables business and turning around the generics segment.
FAQs
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What is the current name of West-Ward Pharmaceuticals?
West-Ward Pharmaceuticals rebranded as Hikma Pharmaceuticals USA in 2018.
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In which pharmaceutical segments does West-Ward/Hikma primarily operate?
The company primarily operates in the generics and injectables segments of the pharmaceutical market.
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What was the significance of the Baxter MSI division acquisition?
The acquisition of Baxter's Multi-Source Injectables division in 2011 made West-Ward the second-largest injectable supplier by volume in the US.
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How has the company addressed challenges in the generics market?
The company is focusing on new commercial opportunities, pipeline execution, and cost optimization to address challenges in the generics market.
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What role does the MENA region play in West-Ward/Hikma's operations?
The MENA region, particularly markets like Algeria and Egypt, represents a significant growth opportunity for the company's branded pharmaceutical business.
Sources cited:
[1] https://www.pharmacytimes.com/view/west-ward-pharmaceuticals
[2] https://tools.euroland.com/tools/PressReleases/GetPressRelease/?ID=3316136&lang=en-GB&companycode=services
[3] https://drugstorenews.com/pharmacy/west-ward-rebranded-as-hikma-pharmaceuticals-usa
[4] https://www.areadevelopment.com/newsitems/1-30-2017/west-ward-pharmaceuticals-columbus-ohio.shtml
[6] https://www.hikma.com/media/pvcbatyb/hikma-reports-2017-full-year-results-003.pdf
