Generic Product Development
Barr is committed to maintaining a full pipeline of generic products
and has continued to increase its investment in generic research and development in support of this commitment. The Company
has a significant number of full-time employees working in the areas of research and development, manufacturing, production
and quality, who support our generic drug activities.
For many years, we have successfully utilized a strategy of developing
the generic versions of branded products that possess a combination of unique factors that we believe have the effect of
limiting competition for generics. Such factors include difficult formulation, complex and costly manufacturing requirements,
limited raw material availability, or unusual regulatory or legal challenges, including patent challenges.
By targeting products with some combination of these unique factors,
we believe that our generic products will, in general, be less affected by the intense and rapid pricing pressure often
associated with more commodity-type generic products. As a result of this focused "barrier-to-entry" strategy, we have
been able to successfully identify, develop and market generic products that generally have few competitors or that are
able to enjoy longer periods of limited competition, and thus generate profit margins higher than those often associated
with commodity-type generic products. Our generic oral contraceptive and injectable product portfolios are examples of our
generic development strategy. At the end of 2007, we manufactured 25 generic oral contraceptive products and six generic
injectable products. We expect our portfolio of injectable products to grow to over a dozen products within the next two years.
Until our acquisition of PLIVA, the execution of this strategy was focused
predominantly on developing solid oral dosage forms of products. While we believe there are more tablet and capsule products
that may fit our "barrier-to-entry" criteria, we have recently expanded our development activities, both internally through our
acquisition of PLIVA and through collaboration with third parties, to develop non-tablet and non-capsule products such as
injectables, patches, creams, ointments, sterile ophthalmics and nasal sprays.
For strategic reasons, the Company does not disclose generic products
under active development other than those that are the subject of patent challenges. Those products are made public following
initiation of litigation.