Teva Pharmaceutical Industries Ltd. (TEVA) may face competition to its top-selling multiple sclerosis drug Copaxone a year earlier than analysts expected after a mixed U.S. court ruling on the patents covering the medicine.
Four patents that expire in May 2014 were upheld today by the U.S. Court of Appeals for the Federal Circuit in Washington, while other patent claims on the drug were invalidated. One of those invalidated patents expires in September 2015.
Teva said it will appeal the decision on the 2015 patent. The company can ask that the case be heard before all active judges or seek review before the U.S. Supreme Court.
Copaxone, Teva’s largest branded medicine, generated $1.1 billion in sales in the first quarter for the Petach Tikva, Israel-based company and accounted for almost a fifth of its revenue last year. The drug, which had made up about 40 percent of the MS market, already is facing competition from Biogen Idec Inc.’s Tecfidera treatment, which won U.S. approval in March.
Teva’s American depositary receipts fell (TEVA:US) 53 cents, or 1.3 percent to $40.73 at 4:15 p.m. in New York trading.
Momenta Pharmaceuticals Inc. (MNTA:US), which is developing a generic version with Novartis AG (NOVN)’s Sandoz, jumped $1.82, or 12 percent, to $17.34, the most since November 2011. Another generic-drug challenger, Mylan Inc. (MYL:US), rose 84 cents, or 2.6 percent, to $33.43 after saying it expects to be on the market in May 2014.
Momenta, based in Cambridge, Massachusetts, said in its annual report that it’s counting on the generic Copaxone to help the company return to profit. Basel, Switzerland-based Novartis also challenged the Copaxone patents.
Multiple sclerosis causes the immune system to attack the insulating tissue around nerve fibers. It stops nerve cells from sending signals, sapping patients’ energy, blurring their vision and slowly depriving them of mobility, balance and coordination. Copaxone is an injection designed to work with the body’s immune system to cut relapses of the disease.
Obtaining U.S. Food and Drug Administration approval won’t be easy for the generic-drug makers, because of the complexity of the Copaxone medicine.
“At this point, it is unclear what the requirements would be for approval of complex synthetic peptides,” Teva said in a statement. The company said “unpredictable differences” between a generic version and the branded medicine could lead to immune problems for patients, and it’s calling for the type of clinical trials that aren’t normally required to receive approve for generic drugs.
Ronny Gal, an analyst at Sanford C. Bernstein & Co., said that Momenta will probably get approval as U.S. regulators become “increasingly comfortable approving complex generics.”
Joseph Schwartz, an analyst with Leerink Swann & Co., in a note to clients projected Momenta has a 65 percent probability of success.
Mylan Chief Executive Officer Heather Bresch said today in a statement the Canonsburg, Pennsylvania-based company expects to begin sales of generic Copaxone on May 25, 2014.
The Federal Circuit ruled that the invalidated patents didn’t clearly outline what Teva claimed was invented. There are ambiguities that make it unclear what molecular weights were used to develop the product, the court ruled.
The case is Teva Pharmaceuticals USA Inc. v. Sandoz Inc., 2012-1567, U.S. Court of Appeals for the Federal Circuit (Washington). The lower court cases are Teva Pharmaceuticals USA Inc. v. Sandoz Inc., 08cv7611 and 09cv8824, U.S. District Court for the Southern District of New York (Manhattan).
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