Momenta Pharmaceuticals, Inc. (MNTA)

[jbog]

Coherus, Momenta Set for Different Outcomes
Shire returned rights to each of the companies’ anti-TNF biosimilars.

Coherus is better positioned for opportunity.


Sept. 28, 2016 2:53 p.m. ET
Maxim Group

A seemingly benign, and to us an expected event from Shire, could translate into two very different outcomes for Coherus BioSciences and Momenta Pharmaceuticals.

We believe Coherus (ticker: CHRS) is now better positioned to capitalize on the anti-tumor necrosis factor (anti-TNF) biosimilar opportunity (in addition to its Neulasta opportunity, which could launch in 2017-2018), whereas Momenta (MNTA) may be heading down an expensive road of intellectual-property litigation for biosimilar Humira, now without a big pharma partner, watching the sand running out of the hourglass.

Both Coherus and Momenta announced that Shire (SHPG) has returned rights to each of their anti-TNF biosimilars: Coherus’ CHS-0214 (Enbrel) and Momenta’s M923 (Humira). The announcement was not a complete surprise as Shire had openly discussed the potential of not developing biosimilars that came on board as a result of the acquisition of Baxalta. However, we believe the impact on Momenta and Coherus may be very different.

The partnership with Shire for CHS-0214 included rights in Europe (Marketing Authorization Application (MAA) filing year-end 2016), while Coherus retained the rights to the U.S. market. With full rights in hand, Coherus gets a “bigger bite of the apple.” A more attractive package (two biosimilars) could create a more robust partnering opportunity, one that includes both anti-TNF biosimilars of Enbrel (CHS-0214) and Humira (CHS-1420, Biologics License Application (BLA) filing year-end 2016). The combined market for the brands is more than $23 billion. To our knowledge Coherus is the only biosimilar company in this position.

With a move away from complex generics (copaxone), Momenta, in our view, was relying on its biosimilar Humira (M923), which had been partnered to [Shire unit] Baxalta, and to us was a mistake. Recall that Baxalta walked away from additional Momenta biosimilars, which may have been a warning sign. With Shire now returning M923 rights, Momenta now has no big pharma partner in the biosimilar Humira race just as the legal battles over IP are heating up, which could extend potential commercial launches out to 2022, particularly for Amgen (AMGN) (the Food and Drug Administration approved Amjevita last week) and Momenta (Phase 3 data late 2016). We believe Coherus’ unique intellectual property could avoid certain patent infringements that could snare Momenta (and Amgen). With potentially lengthy and costly intellectual-property battles over Humira ahead and no partner, expenses likely will continue to rise. Recall that Momenta is spending about $200 million a year. The clock is ticking.

-- Jason McCarthy
-- Jason Kolbert

http://www.barrons.com/articles/coherus-momenta-set-for-different-outcomes-1475088805?mod=yahoobarrons&ru=yahoo&yptr=yahoo