Generics gaining new foothold

A quiet revolution has taken place in Canada’s pesticide industry that will bring farmers lower prices, more product selection and more timely registration of new products, say manufacturers and grower groups.

The most recent development is the new regulations governing the registration of generic pesticides, which could save farmers hundreds of millions of dollars starting in 2011.

Amendments to Canada’s Pest Control Products Regulations, which became law on June 23, will speed up registration and introduce more generic products into the marketplace.

Dale Kushner, Canadian commercial business manager for Makhteshim Agan of North America (MANA), said a process that used to take two to four years will now take 14 months.

“It’s just so much more predictable that I think you’ll see a lot more competition coming to Canada,” he said.

Peter MacLeod, vice-president of chemistry with CropLife Canada, said the regulations walk a fine line between providing adequate protection to product innovators and giving generic manufacturers a fair process for getting their products to market.

There have been 37 registrations of generic products since the policy was put in place in August 2007. There are 97 more applications in the queue that will start being processed now that the regulations have become law. Almost two-thirds of those applications are for herbicides.

“By the time spring rolls around, there will certainly be a lot more products on the marketplace here in Canada,” said MacLeod.

In its regulatory impact analysis statement, the Pest Management Regulatory Agency estimated the new rules could save farmers between $11 million and $26 million over 10 years.

“My opinion is that is very, very, very low and conservative,” said Kushner.

Bob Friesen, vice-president of government affairs with Farmers of North America, agreed that the PMRA low-balled that number.

His company introduced a generic grassy weed herbicide called MPOWER Aurora to the marketplace this spring. Before its introduction, similar herbicides cost farmers up to $20 per acre. MPOWER Aurora dropped that cost to $10.75 per acre.

Competition from FNA’s product and MANA’s Ladder forced an across-the-board drop in grassy weed herbicide prices.

“It would have saved about $60 million for farmers,” said Friesen. “It was in about 30 days where that happened.”

Kushner estimated the savings for growers at $50 million to $70 million.

Friesen said growers can expect more of the same now that new regulations “put some teeth” into what had formerly been a policy that relied on co-operation from all the parties involved.

“Once you have regulations, now there is some responsibility and accountability,” he said.

The FNA was hoping Canada’s regulations would mirror what happens in the United States, where generic companies are allowed to introduce new products while they are negotiating a compensation package with the patent holder.

In Canada, generic companies will have to wait until the 120 day negotiating period has expired.

But Friesen agreed with Kushner that the new system will be lightning fast compared to the old one, where MPOWER Aurora was two years getting to market. He expects hundreds of millions of dollars in future cost savings for farmers.

Mark Goodwin, pest management co-ordinator with Pulse Canada, said there has been a good balance of new policy measures to ensure price competition from generics and the continued introduction of new pesticide products for farmers.

“There is a quiet revolution that has gone on in terms of crop protection products,” he said.

Enshrined in the recently adopted amendments are incentives for chemical companies to add minor uses to their existing labels. Every three minor uses they add extends their data protection period, allowing them to stave off competition from generics.

That’s a side benefit because many crops grown in Western Canada are considered minor use crops, said Goodwin.

Equally important is the joint review process for new products.

Regulators in Canada, the United States and Europe are increasingly jointly reviewing submissions for new products. They are splitting up the workload of reviewing 200 binders of environmental and health and safety data.

“That means the company gets a faster launch into all the markets all at the same time,” said Goodwin.

Canadian growers used to look with envy at U.S. growers who were using new pesticides three to five years before their Canadian counterparts.

“The big win for growers in Canada is they get their hands on the new stuff sooner and they’re not at a competitive disadvantage to their neighbours in the U.S.”

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