Generic pharma companies have patent advantage

The manager of the Finsbury Worldwide Pharmaceutical trust believes companies manufacturing generic medicines will continue to outperform the pharma giants.

Samuel Isaly says the large pharmaceutical companies have worse growth prospects when their patents begin to run out. In place of these stocks he has been increasing the fund's exposure to generic companies, taking the fund's position in the sector up to 15%. "With so many patents expiring, generics are experiences tonnage growth," he says. "We particularly like the Japanese market which has not yet converted from branded products, but where there are Government-backed incentives to drive the growth of generic drug use." Although six of Isaly's top 10 holdings are large-cap phar...