An analysis of 188 generic products, their launch prices, and the final prices show that there is a relationship between the high value products and high price declines. Wavedata has previously found that a strong relationship between price decline and the original brand prices do exist. In the case of generics, there may be other factors that reduce the strength of this relationship. For example, a high value generic may have sister products containing the same ingredient, but at lower strengths, watering down the effect. Another factor is that a high priced product may have a small market share, or be in a declining market with fewer clinicians prescribing it.
Overall, it does suggest that if a product is launched on day 1 with a high price, it will eventually attract many other license holders to compete for a declining reward. The converse example of a low value product, where license holders are able to nurture a low return niche does appear to be possible.
Wavedata collects these prices from pharmacies and dispensing doctors, and have been doing so since the year 2000. Each month over 100,000 prices are collected for generics, parallel imports, UK brands, and devices, and this timely information is added to the Wavedata Live system every 15 minutes, and the historical information is used to produce analyses like these.