From producing herbal extracts in 1920s to discovering a new antibiotic drug Azithromycin in 1970s to becoming one of the leading centers for pharmaceutical research and development in Eastern Europe, the journey of PLIVA shows how a small company can become a global leader using an effective intellectual property (IP) management approach.
PLIVA – from a local business to global quality
Born in 1921 as a business producing herbal extracts in Zagreb, Croatia, today PLIVA is the largest pharmaceutical company in the country and one of the leaders in the Southeast Europe region. PLIVA has the widest range of generic drugs production in Central and Eastern Europe, and most of its products (almost 90%) are aimed mainly at export to the USA and European countries.
Having been in the pharmaceutical business for over a century, today PLIVA operates not only in Croatia, but also in Bosnia and Herzegovina, Slovenia, Serbia, Macedonia and Montenegro, and is a member of the Teva Group, one of the largest pharmaceutical companies in the world.
PLIVA also has the approvals of the American Food and Drug Administration (FDA), the British Medicines and Medical Products Agency (MHRA) and other relevant European agencies, confirming that the company meets global quality standards.
Using pharmaceutical research and IP tools for growth
Already in 1936, PLIVA started to conduct its own research work in collaboration with Professor Vladimir Prelog from the University of Zagreb, who later won the Nobel Prize in Chemistry. The first drug developed during these research efforts was sulfanilamide (an active medicinal substance with bacteriostatic action), which the company protected with a patent. PLIVA also patented its own technologies for production of vitamin C, vitamin B and vitamin B12, rapidly growing its production line. By mid-fifties, the company has founded its own Research Institute.
Thanks to PLIVA’s dedication to research and development of new drugs, in 1970s the company has discovered its biggest success – an antibiotic azithromycin, which to this day remains PLIVA’s best known achievement, making Croatia one of the only 9 countries that have their own antibiotic.
The history of pharmaceutical research at PLIVA has also made Zagreb one of the leading centers for research and development in the Teva Group. Today, PLIVA has filed over 160 patents around the world through the International Patent System (PCT).
IP – the key to commercialization of Azithromycin
An antibiotic named Azithromycin is the first representative of azalide antibiotics. From early trials, Azithromycin proved to be extremely efficient and capable of remaining in the body tissue of animals longer than other similar antibiotics.
In 1981, PLIVA filed a patent application for Azithromycin in the former Yugoslavia and subsequently patented it worldwide, including in the United States.
Patenting proved to be the key to the commercial success of Azithromycin: scientists from pharmaceutical multinational Pfizer Inc. came across PLIVA's patent while searching the database of the US Patent and Trademark Office (USPTO) and realized the enormous potential of the antibiotic. As one of the largest drug makers in America with sales representatives worldwide, Pfizer was able to offer PLIVA an ideal channel to commercialize its antibiotic.
In 1986, the talks between the PLIVA and Pfizer eventually led to a licensing agreement through which both companies, as well as the general public, could benefit from the commercialization of the powerful antibiotic. Under the agreement, Pfizer acquired the right to sell Azithromycin worldwide. PLIVA, however, maintained the right to sell the product in Central and Eastern Europe and would earn royalties on Pfizer’s sales.
PLIVA’s trademarks around the world
In 1988, PLIVA launched Azithromycin in Central and Eastern Europe under its own internationally registered brand name Sumamed®. Today, PLIVA has 6 active international trademark registrations for Sumamed, active up to 2030.
Having realized the benefits of registering the Sumamed trademark at an international level, over the years PLIVA has gone on to register almost 700 trademarks through the Madrid system, with over 300 trademarks active in 2024.
PLIVA’s business results
Zithromax - Pfizer's branded version of Azithromycin - was one of the bestselling branded antibiotics in the United States and worldwide, with total sales peaking at US$ 2 billion in 2005 before starting to decline with the loss of patent protection in 2006 and resulting generics competition. However, the strong and proven Zithromax brand name has helped keep market share losses in check.
For PLIVA, a pharmaceutical company of small proportions in comparison to its licensee Pfizer, the licensing agreement meant a huge breakthrough in terms of annual revenues and allowed it to fund expansion in Europe and the United States.
PLIVA has become the largest pharmaceutical company in Croatia as well as one of the largest, in terms of sales, in Central and Eastern Europe. In 2006, PLIVA exited its proprietary business and became the European generics arm of Barr Pharmaceuticals Inc., and at the end of 2008, became part of Teva Pharmaceutical Industries Ltd.
PLIVA: penetrating foreign markets thanks to IP
The story of PLIVA shows how even relatively small pharmaceutical companies can benefit from patent protection to grow their business. PLIVA’s investment in research and development was an intelligent business approach, and its sound intellectual property strategy allowed the company to commercialize the results of this research. PLIVA’s IP management opened the way for PLIVA’s products to appear in foreign markets which would otherwise seem inaccessible.
