Teva, In Turnabout, Sues to Protect Its Multiple Sclerosis Drug Copaxone
Is this a rare case of Teva Pharmaceutical being forced to swallow its own bitter medicine? The world's largest generic manufacturer, founded on its unflinching willingness to challenge the patented protection of branded products owned by other drugmakers, is suing generic rival Mylan. Teva alleges patent infringement of its flagship multiple sclerosis drug Copaxone, and reiterates that intellectual property rights covering chemical composition and methods to use it are protected through May 2014.
Teva is best known for its copycat drugs, from recently launched generic versions of the birth control pill Ortho Tri-Cyclen and the colorectal chemotherapeutic agent Eloxatin (oxaliplatin) to such blockbuster drugs as Adderall XR (amphetamine salts) for narcolepsy and ADHD and Protonix (pantoprazole) for acid reflux. However, in recent years the company has sought to mitigate encroaching generic competition -- and resultant pressure that shorter pricing life cycles have on margins -- by broadening its drug portfolio to include leading branded products.
Copaxone (glatiramer acetate), a self-administered subcutaneous injection, is the number one MS therapy in the U.S. and globally, with approximately 30 percent market share. The MS therapy remains a key growth driver to Teva's overall profitability. In the U.S., in-market sales increases year-over-year 53 percent to reach $540 million, accounting for 25 percent of total U.S. sales, according to the third-quarter 2009 regulatory filing with the SEC. Ergo, the entrance of generic glatiramer acetate would quickly erode brand sales and profits: erosion of branded product sales after just two quarters of generic entry can reach upwards of 90 percent, according to market researcher Datamonitor.
Teva commonly wields its legal sword -- or the threat of the same -- to cut down the patents shielding the exclusivity of popular medicines sold by other generic rivals and branded pharmaceutical manufacturers. Not unexpectedly, Teva initiated a patent infringement lawsuit against Mylan in response to its rival's abbreviated New Drug Application (ANDA) for Copaxone, accusing Mylan of infringing seven patents covering the product. In addition, Teva executives have said for months now that MS is a serious disease, arguing that its scientists had serious reservations that competitors' products could meet Copaxone's identical molecular compensation and efficacy.
Teva chief executive Shlomo Yanai confidently opined on the earnings call that it was highly improbable that a serious generic threat to Copaxone would reach the market any time soon. He emphasized that glatiramer acetate was extremely difficult to manufacture, as even subtle changes in the manufacturing process or molecular weight distribution of the drug's active ingredient could influence safety and outcomes. In addition, any potential generic version of Copaxone ought be evaluated in placebo-controlled clinical trials with clinical endpoints, argued Yahai, to establish the efficacy and safety and to measure [the degree of] effects of immunogenecity on the multiple sclerosis patients.
To say you embrace a principle means little, more so if you are not beholden to carrying it out: in the context that Teva is looking to put patient safety ahead of profits -- absurd! Last year Teva received approval from European regulators to market TevaGrastim, its own "bio-similar" version of Amgen's branded granulocyte colony-stimulating factor, called Neupogen (filgrastim), to EU member states. Both drugs are indicated for for the treatment of chemotherapy-induced neutropenia. I guess the hypocrisy is that clinical trial studies -- especially in MS or chemotherapy-treated patients with demyelination and depleted white blood cell issues, respectively -- should be mandatory for all generic and brand name companies, save for Teva!
Notwithstanding questionable ethics, whether or not Mylan legally overstepped is moot, for the litigation triggers a stay of FDA approval for the Mylan ANDA until 30 months pass or a district court decides in Mylan's favor. Which means Mylan and prior challengers would be unable to launch alternative generic versions before 2011 - 2012, unless the courts dismiss Teva's lawsuit. Ergo, the intent is to tie rivals' hands as long as possible, or to force Mylan and other rivals to the table and negotiate [less-profitable] "pay -not-to-play" deals. Just the way Big Pharma has long treated, you know, Teva.
Looking to 2010, Teva has 210 product applications awaiting final FDA review, covering annual U.S. branded sales of at least $113 billion. Of these submissions, 136 were patent challenges of branded products. Teva believes it is the first to file -- providing 180-day market exclusivity -- on 83 applications with annual U.S. branded sales exceeding $54 billion.
As goes the proverb: "every path has a puddle." Should the FDA reject Teva's position regarding human clinical trials for Copaxone, near-term growth could take a stumble in the mud. A good thing, therefore, that come next year Teva will add to its medicine cabinet copycat drugs to treat migraine headaches, Imitrex (sumatriptan), and Effexor XR (venlafaxine) for depression.