Update: Will Teva Lose Patent Protection For Copaxone After All?
- Teva announced Tuesday a favorable U.S. Supreme Court ruling over its patent for Copaxone, dealing a blow to various generic developers that are attempting to enter the MS space.
- I reiterate my bullish thesis on Teva.
- As expected, Teva continues to improve its prospects amid the enormous patent cliff. The favorable Supreme Court ruling corroborates this position.
- Recently, Teva has been authorized by the US Food Drug and Administration to introduce the generic counterpart of Diovan “Valsartan” tablets in the US market.
- The anticipated elevation in earnings is calculated to be $29 million. On a per share basis, the EPS is computed to go up by $0.03 in 2015.
- Apart from entering into the generic market of Diovan, Teva is also actively moving ahead to introduce generic version of two other antibiotics in the US market.
- The launch of generic equivalents of Pfizer’s Zyvox and USP’s Nafcillin is expected to uplift the EPS by $0.01 in the fiscal year 2015.
- The addition of generic medicines to its product portfolio will fortify the company’s business and stabilize its revenue generation sources which have continued to get affected by patent expiries.
Update: U.S. Launch Of Generic Diovan Improves Teva's Outlook
- On Tuesday, Teva announced the U.S. launch of generic Diovan.
- I reiterate my bull thesis on the company.
- As expected, Teva continues to improve its prospects amid the enormous patent cliff.
Teva Pharmaceutical Industries: Is It Time To Buy Or Sell?
- Shares of Teva are trading near 52-week highs.
- I believe it's difficult to determine the margin of safety at current price levels, as a myriad of factors could restrict Teva's growth (e.g., the patent cliff).
- A conservative options strategy mitigates these risks, while enhancing Teva's current yield.
- Copaxone’s sales are under serious threat as two of its generic versions made it to the market in September 2015.
- Teva’s Pulmicort, which treats asthma, is also expected to face generic competition in the future.
- Teva has successfully achieved FDA approval for the generic version of Pfizer’s Celebrex.
- The company has also successfully developed and launched Novartis’s Exforge HCT.
Generic EpiPen Could Give These 2 Stocks A Jolt Of Adrenaline
- Potential generic EpiPen launch date of June 22, 2015, assuming FDA approval.
- Analysis is provided using a comparable exclusive generic launch.
- It's unclear if another generic may enter before patents expire in 2025.
TEVA: Copaxone Patent Expiry Worries Are Overblown
- Copaxone worries are overblown and being compared to typical small molecule expiration's and not to biologics, which have higher retention rates behind patent expiry.
- The company has been preparing for Copazone's loss for years now diversifying its business mix with new acquisitions in the pharma space and growing biosimilar business.
- Management has been wringing out the expenses to grow operating margins and boost profitability.
- Growth has been tepid for Teva; in response, it had streamlined operations and has continued to increase R&D spend into core growth areas.
- I believe investors have already discounted shares of Teva, based on a generic rival competing with its drug Copaxone.
- Teva offers an attractive 2-to-1 reward-to-risk profile, even in the midst of potential major competition versus its key drug, Copaxone.
- Teva still offers an asymmetrical risk-reward opportunity.
- The company’s generic business showed significantly improved profitability.
- We continue to expect Teva to become either a target or a beneficiary from a merger-of-equals scenario.
- Teva is trying to recover the Copaxone sales loss due to patent expiration by introducing an improved version of Copaxone 40mg.
- Teva revealed positive data from the phase 3 study of its drug reslizumab for the treatment of moderate to severe asthma.
- Teva won its case against AstraZeneca in the UK High Court paving the way for the company to launch its DuoResp Spiromax inhaler in the UK.
- Recently Teva received 180-day marketing exclusivity in order to launch the generic version of Baracludes.
- Teva demonstrates how dependence on patented pharmaceuticals is a poor long-term business strategy.
- Sales of one such medication, Copaxone, are responsible for one fifth of Teva’s revenue.
- Teva is willing to do almost anything to preserve its Copaxone patent, which expired in May.
- Teva’s addiction to Copaxone revenue is now a threat to its future.
- Teva might be sacrificing long-term survival for short-term profits.
- Teva Pharmaceuticals has been in stagnation mode for several years.
- Its lead profit center, Copaxone, is under imminent threat from generics.
- Yet, it has turnaround characteristics, and Copaxone may turn out better than feared.
- Overall, I rate TEVA as a reasonable "buy" here to gain exposure to secular growth trends at a low valuation, with the possibility of a takeover if operations go poorly.
Teva Pharma: Underpriced And Misunderstood, Identifiable Catalyst
- Generics pharma giant Teva is a prime example of how the DCF can help the investor better exploit valuation mis-pricings.
- The long-term opportunity for lower-cost generics in an environment where governments across the globe are looking to cut expenses and become more efficient is just too great to pass up.
- The market is focusing too much on the patent expiration of Copaxone. The loss of exclusivity isn't a done deal, and shares have tremendous valuation upside with an identifiable catalyst.
Teva Offers A Good Long-Term Investment Opportunity
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Tue, Jan. 20, 10:25 AM
- The U.S. Supreme Court votes 7 - 2 in favor of Teva Pharmaceutical Industries (TEVA +1.9%) in its fight with generic drug makers over a Copaxone (glatiramer acetate injection) patent. The justices stated that the U.S. Court of Appeals for the Federal Circuit did not use the correct approach in analyzing whether the patent in question, due to expire in September, was valid.
- Previously: Teva due to appear in Supreme Court over Copaxone patent (Oct. 15, 2014)
Thu, Jan. 15, 1:53 PM
Thu, Jan. 15, 7:22 AM
- In an effort to increase its focus on developing new drugs, privately-held Boehringer Ingelheim says that it is considering the sale of Roxane Labs, its U.S.-based generics unit. The company believes it makes more sense for a generics specialist to own the 1,300-employee business.
- The generics industry is fiercely competitive as the number of blockbuster drugs coming off patent has declined from its peak in 2012. The top players are (NYSE:TEVA), Sandoz (NYSE:NVS) and Actavis (NYSE:ACT).
- According to Bloomberg, Roxane could fetch as much as $2.4B. Morgan Stanley is advising.
Tue, Jan. 6, 8:18 PM
Dec. 30, 2014, 9:22 AM
- Prompted by Teva Pharmaceutical Industries' (NYSE:TEVA) move away from oncology R&D, OncoGenex (NASDAQ:OGXI) and Teva terminate their collaboration on the development of custirsen for the treatment of prostate and lung cancers.
- Under the terms of the final agreement, OncoGenex will regain the rights to custirsen and receive a $27M payment from Teva subject to certain adjustments. The payment will fund the completion of the Affinity Phase 3 study through data readout in late 2015/early 2016 as well as the continuation of the Enspirit trial through the second interim futility analysis expected in H1 2015.
Dec. 25, 2014, 12:41 PM
- Endo International plc (NASDAQ:ENDP) subsidiary Endo Pharmaceuticals and BioDelivery Sciences (NASDAQ:BDSI) submit a New Drug Application (NDA) to the FDA for Buprenorphine HCl Buccal Film for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment and for which alternative treatment options are inadequate.
- The product uses BioDelivery's BioErodible MucoAdhesive (BEMA) technology to deliver buprenorphine across the buccal mucosa (inside lining of the cheek) via a thin film that adheres to the cheek lining in less than five seconds and then completely dissolves.
- Buprenorphine is a partial mu-opioid receptor agonist and a kappa antagonist which is different than full mu-opioid agonists like morphine. It is a Schedule III controlled substance which has a lower abuse potential than Schedule II drugs.
- Opioid-related tickers: (NASDAQ:ZGNX) (NYSE:PFE) (NASDAQ:EGLT) (NASDAQ:ACUR) (NYSE:MNK) (NYSE:ABBV) (NYSE:TEVA) (NASDAQ:ALKS)
Dec. 23, 2014, 8:43 AM
- The FDA approves Teva Pharmaceutical Industries' (NYSE:TEVA) Granix (tbo-filgrastim) Injection for self-administration by patients and caregivers. This will enable physicians to prescribe the product for either in-office or at-home use.
- Granix is a leukocyte growth factor indicated for the reduction in the duration of severe neutropenia in patients with non-myeloid malignancies receiving myelosuppressive anticancer drugs associated with a clinically significant incidence of febrile neutropenia. It has been commercially available in the U.S. since November 2013 and, until now, had to be administered by a healthcare professional.
- Teva plans to launch the new Granix syringe for self-administration in Q1.
Dec. 19, 2014, 9:26 AM
- The FDA approves Teva Pharmaceutical Industries' (NYSE:TEVA) QNASL (beclomethasone dipropionate) 40 mcg for the treatment of nasal symptoms associated with allergic rhinitis in children 4 - 11 years of age. It will be commercially available in February.
- The product's 80 mcg formulation is cleared for use in patients at least 12 years old.
Dec. 11, 2014, 7:45 AM
- Teva Pharmaceutical Industries (NYSE:TEVA) provides its outlook for 2015 (versus most recent guidance for 2014):
- Net Revenues: $19.0B - 19.4B vs. $20B - 20.3B; Gross Profit: 59.5 - 61.5%; Operating Income: $5.7B - 5.9B vs. $5.65B - 5.75B; EPS: $5.00 - 5.30 vs. $5.00 - 5.10; CF Ops: $4.3B - 4.7B.
- Generics revenues: $9.1B - 9.5B; Generics Profit: $2.4B - 2.6B; Specialty revenues: 7.9B - 8.3B; Specialty profit: $4.1B - 4.4B.
- Copaxone: $3.5B - 3.7B; Azilect: $350M - 400M; Nuvigil: $300M - 330M; Treanda: $670M - 750M; ProAir family: $470M - 580M; Qvar family: $310M - 380M.
- Guidance assumes the entry of two generic competitors to Copaxone in the U.S. beginning in September. Earlier entry could reduce operating income by $30M - 50M per month. Generic Pulmicort will face additional generic competition in the first half which will decrease revenues $400M - 500M and decrease operating profit by $100M - 200M.
- Share buybacks should be $1.0B - 1.2B.
- Shares are off a fraction premarket on average volume.
Dec. 10, 2014, 9:48 AM
Dec. 10, 2014, 8:06 AM
- The Phase 3 study of Acorda Therapeutics' (NASDAQ:ACOR) CVT-301 for the treatment of OFF episodes in patients with Parkinson's disease (PD) is underway with the enrollment of the first patient. An OFF episode is a period of time during which PD symptoms such as tremor, muscle stiffness and slow movement reemerge despite taking PD medications.
- CVT-301 is a self-administered inhaled therapy that delivers a precise dose of levodopa through the lungs to return PD patients to an ON state.
- The multi-center, double-blind, randomized Phase 3 trial will enroll ~345 subjects across three treatment arms: 50 mg, 35 mg or placebo. The primary endpoint is improvement on the Unified Parkinson's Disease Rating Scale (UPDRS) Part III.
- Acorda obtained the rights to CVT-301 via its acquisition of Civitas Therapeutics.
- Previously: Acorda to buy biopharma firm (Sept. 24, 2014)
- PD-OFF-related tickers: (OTCQX:CYNAF) (NASDAQ:NDRM) (NASDAQ:IPXL) (OTCQB:TTNP) (OTCQB:SGTH) (NYSE:TEVA) (NASDAQ:ADMS) (NASDAQ:PRTA) (OTCQX:RHHBY)
Dec. 4, 2014, 11:44 AM
- Teva Pharmaceutical Industries (TEVA +0.6%) receives a Positive Assessment Report from the U.K. supporting a three-times-per-week dosing regimen of Copaxone (glatiramer acetate) 40 mg/ml for the treatment of patients with relapsing forms of multiple sclerosis. The positive outcome under the Decentralized Procedure also involved the Reference Member States Medicines and Healthcare Products Regulatory Agency and all Concerned Member States in Europe. The granting of national authorizations will occur shortly.
- Three-times-per-week Copaxone reduces the number injections by almost 60% compared to the once-daily 20 mg/ml formulation while maintaining its benefits.
- The FDA approved the 3x/week formulation in January.
- Previously: Teva rises after FDA OKs higher-dosage Copaxone (Jan. 29, 2014)
Dec. 4, 2014, 7:46 AM
- CTI BioPharma (NASDAQ:CTIC) receives a $15M milestone payment from Teva Pharmaceutical Industries (NYSE:TEVA) related to sales of the leukemia drug Trisenox (arsenic trioxide). CTI is eligible to receive up to an additional $80M in sales- and development-related milestones.
- Teva obtained the rights to the drug via its acquisition of Cephalon which acquired Trisenox from CTI.
Dec. 3, 2014, 7:36 AM
- AstraZeneca (NYSE:AZN) could be on the hook for substantial damages if it loses a trial in Boston involving Ranbaxy Laboratories Ltd. (OTC:RBXLY) (OTC:RBXZF) and their pay-to-delay agreement that blocked generic competition to Nexium. This is first such trial since the U.S. Supreme Court ruled that companies can be sued over these deals if the payments are large and unjustified.
- The suit challenges a 2008 settlement of a patent dispute between the two companies that postponed the entry of generic competition until this year. Plaintiffs argue that the $1B+ that Ranbaxy received violated antitrust law and was excessive for a patent case.
- Teva Pharmaceutical Industries (NYSE:TEVA) was also a defendant in the case but it reached a settlement with the plaintiffs after four weeks of testimony.
- If the plaintiffs win, there will be another trial to determine the amount of damages. A win, though, is far from certain because the drug buyers have failed to show that they were harmed by the deal. Two weeks into the trial, AstraZeneca filed a motion to throw out the claims on the basis that the plaintiffs' experts failed to offer evidence of what they regard as proper royalty rates for drugs, a stipulation made by the court for the trial to proceed. Judge William Young denied the motion without elaborating.
- Nexium generated almost $4B in sales last year.
Dec. 1, 2014, 4:00 PM
Dec. 1, 2014, 12:26 PM
- Teva Pharmaceutical Industries (TEVA) launches its generic equivalent to Novartis' (NVS -0.1%) high blood pressure med Exforge HCT (Amlodipine, Valsartan, Hydrochlorothiazide) Tablets in the U.S.
- Teva was the first to file so it has marketing exclusivity against other generic firms for 180 days.
- Per IMS Health, Exforge HCT generates annual sales in the U.S. of ~$158M.
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