Sales of most of the fast growing brands of Hepatitis B vaccine are falling steadily across the country upsetting the bottomline of the leading players. During 2002-03, the market performance of hepatitis B vaccine brands in the country were not only negative but also abysmally low registering a fall of about 55 to 60 per cent compared to the sales during 2001-02 and 2000-2001.

Biovac B of Wockhardt, the market leader in hepatitis B vaccine with a share of almost 31 per cent, recorded a sales of just Rs 8 crore this year as compared to Rs 36.6 crore recorded in 2001-'02.

The IMS Health data, which showed a market of Rs 116 crore in 2001 and estimated an annual growth at the rate of nine per cent for the Hepatitis B vaccine market in the country, has shrunk to as low as about 20 crore during the year under review. Interestingly, the industry source had even officially estimated a market size of Rs 250 crore combining the direct and institutional sales two years ago.

During that period, the other notable brands in the Hepatitis B market included GlaxoSmithkline's Engerix B at Rs 20.7 crore, Shanta Biotech's Shanvac at Rs 8.0 cr along with Hepashield (Pfizer) at Rs 13 cr; H B Vac of Zydus at Rs 15 cr; and others including Serum Institute, Bharat Biotech, Panacea Biotech, Cadila, Intas and VHB accounting for Rs 22 crore.

According to Wockhardt sources, Biovac B, which was a highly profitable product for the company, contributed negligibly to sales and profit in Q4CY02 due to shrinking growth opportunities and falling prices. The sources added that Hepatitis B Recombinant biotechnology products BIOVAC-B (Hepatitis-B vaccine) and WEPOX (erythropoietin) were the primary growth-drivers for the domestic market in the past. BIOVAC-B had even surpassed its sales target of Rs. 30 crore, and also became the largest selling Hepatitis-B vaccine in the market.

However, the growth opportunity, which was created through awareness and education drive of the company has already started shrinking as more than 3 million Indians vaccinated against Hepatitis-B infection in various states of India, the company sources said.

Pfizer's Hepashield sales, which was 16 crore last year was only Rs 2 to 3 crore in the beginning of this year. Following the shrinking market and low margin, the company has also decided to withdraw its hepatitis-B vaccine, Hepashield, from the market, which is one of its rarest decisions on product withdrawal.

Industry sources say the pharma major`s decision signals the beginning of a shakeout in the hepatitis-B segment. Till a few years ago, this segment commanded one of the highest profit margins, enticing pharma companies by the dozens.

Sources in Pfizer India said this decision to withdraw Hepashield followed a steep fall in sales and price realisations. Besides, the company wants to shift its focus to new drugs being launched in the Indian market. Pfizer has been sourcing Hepashield from Shanta Biotechnics. Hepashield was among the top-five brands in this segment. By August 2002, sales had fallen almost 50 per cent to Rs 7.8 crore.

Ranbaxy, which had announced plans to launch a hepatitis-B vaccine through a sourcing arrangement with Aventis Pasteur, is also learnt to have put its plans on hold. According to industry sources, a couple of more players are likely to exit from this market, which is estimated to be shrinking by 40 per cent. The shakeout may be attributed to falling margins and increased competition.

Serum Institute manufactures its HBV at its Pune-based plant with a capacity to manufacture 100 million doses. Only a part of the current capacity is utilized for the manufacture of the vaccine, which is then domestically distributed. According to sources, the current capacity will be sufficient to meet the demand from exports.

Currently only few companies like Wockhardt, Shantha Biotech, Bharat Biotech, Panacea Biotech and Zydus Cadila and Serum seems interested to continue the product in the country. However, most of these companies already started concentrating on export market as the domestic market is shrinking and becoming highly competitive. However, these exports are predominantly to the under developed and the developing regions of the world on institutional basis.