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Teva Braces for Tussle With U.S. Insurers Over Copaxone’s Heir
http://www.businessweek.com/news/2014-03-02/teva-braces-for-tussle-with-u-dot-s-dot-insurers-over-copaxone-s-heir
Teva Pharmaceutical Industries Ltd. (TEVA:US) is using records from its 24-hour support hotline in the U.S. to persuade thousands of multiple sclerosis patients to switch from its biggest-selling drug, Copaxone, to a new version that has patent protection until 2030.
It’s a desperate moment for Teva: Copaxone, which brings in $4.3 billion in annual sales and accounts for more than half its profit, may have generic copies by May, when its remaining U.S. patents expire. The Petach Tikva, Israel-based company is trying to soften the blow by persuading patients and their doctors to switch from the daily injection to a new, three-times-a-week version.
The toughest customer for the new version, though, might be insurers, who know a cheaper generic for the original Copaxone is on its way. The new version won’t be able to claim any proven health benefits over the older version beyond convenience.
“Some payers are viewing this as Teva’s strategy to avoid losing patients and they may take an aggressive stance,” said Gary Owens, a former executive at a licensee of the Blue Cross Blue Shield Association of health insurers who now runs an independent consulting business. “It’s going to be a wrestling match between two 500-pound gorillas.”
Given the expected generic competition and soaring sales of new branded drugs that come in pill form, such as Biogen Idec Inc.’s Tecfidera, analysts estimate that sales of Copaxone will fall 56 percent by 2016. (TEVA) Teva’s American depositary receipts are down 23 percent from the record (TEVA:US) set in 2010, in part on concern about competition to Copaxone.
Patient Support
Kimberly Harter is the poster child for Teva’s plan. Harter has struggled to remember her daily Copaxone injection since 2005, the year her multiple sclerosis was diagnosed. So when her neurologist in Salt Lake City described the new version, requiring only three shots a week, during a routine visit in January, the single mother from Utah was eager to try.
“It’s hard to remember to inject yourself every day,” Harter, 37, said from her home in Provo, Utah. “Whenever that happens, I worry it will throw off my treatment.”
In addition to contacting doctors like Harter’s neurologist, Teva has started e-mailing patients registered with its Shared Solutions program, a patient-support hotline staffed by nurses 24 hours a day, since the U.S. Food and Drug Administration cleared the drug on Jan. 28.
“Our records show that you may be a candidate for this new treatment option,” read one promotional e-mail obtained by Bloomberg News. “Talk to your health-care provider.”
Clinical Advantage
Teva has contact with 85,000 patients, said Jon Congleton, who oversees the company’s central nervous system drugs, including Copaxone. “The awareness has been building,” he said in an interview.
Unlike patients and doctors, insurers probably will ask whether the new Copaxone has health benefits beyond convenience, said David Lassen, chief clinical officer at Prime Therapeutics LLC, a U.S. pharmacy benefit manager. Teva may struggle to show that because the clinical tests presented to the FDA compared the long-lasting medicine to a placebo -- not Copaxone, which has been on the market in the U.S. since 1997.
“We are going to assess first of all if this agent, relative to the daily agent, offers a significant clinical advantage,” Lassen said. “And by that I mean any safety or efficacy uniqueness that will offer a true clinical outcome advantage versus the daily drug.”
CVS Caremark Corp., the largest provider of prescription drugs in the U.S., Aetna Inc., the third-biggest insurer, Express Scripts Holding Co., the biggest drug benefits manager, didn’t comment on how they plan to cover the new Copaxone.
Price Questions
For now, Teva is offering a small discount on the new product. It sells it for $60,500 a year, or $1,000 less than the old version. The daily version is a 20-milligram injection, while the newer product is 40 milligrams three times a week.
Amid the looming threat of a generic -- and competition from pills such as Tecfidera and Novartis AG (NOVN)’s Gilenya -- Teva has raised the price of Copaxone. In January it increased the cost of Copaxone by 9.9 percent, according to Congleton. The drug’s price has more than doubled in the past eight years, according to Bloomberg calculations based on data from Excellus, a nonprofit licensee of the BlueCross BlueShield Association.
Teva is optimistic about insurance coverage. Congleton says the company expects to convert 30 percent to 50 percent of patients to the long-acting Copaxone. While the payers have “economic incentives, they also focus on what’s best for the patients and there’s obviously a clear benefit there,” he said.
‘Cutting Deals’
Teva converted 4.6 percent of total Copaxone prescriptions to the 40-milligram dose for the week ending Feb. 21, said Asthika Goonewardene, a Bloomberg Industries analyst in London, citing data from Symphony Health. Teva said in an e-mailed statement that it’s “encouraged by the response to date.”
The approval of a generic probably will precipitate a decline in sales and bring Teva to the negotiating table on price, said Joseph Sinopoli, president at PreLaunch Strategy LLC, which provides reimbursement and consulting services in Boston. A first copy might be 20 percent cheaper than the original, he said.
At that point, “Teva is going to be cutting deals,” with insurance companies, he said.
Momenta Pharmaceuticals Inc. (MNTA:US) and Novartis AG’s Sandoz unit are working together on a generic version of daily Copaxone, called M356, and are awaiting regulatory approval. Momenta plans to be ready to start selling the drug at the time of patent expiration, Chief Executive Officer Craig Wheeler said on a Feb. 10 conference call.
No Biking
Multiple sclerosis is a chronic inflammatory disease that robs patients of muscle coordination and balance. It stems from damage to the myelin sheath, fatty tissue that protects nerve fibers in the brain and spinal cord used to conduct electrical impulses that control movement.
Harter says she can no longer pick up her kids or ride a bike, and at one time she was so incapacitated she had to temporarily give up care of her three children.
Copaxone reduces the frequency of relapses for people with a form of MS known as relapsing-remitting.
Last week, Harter received a three-month supply of her new 40-milligram shots, for which she paid a $3.80 co-payment. “I am so thankful,” said Harter, who said she hopes nothing changes when a generic version of the daily medicine reaches the market.
That was a nasty close on MNTA. Who knows really.
FWIW HALO is 12. Jazz off 9. ISIS off 10.
I'm not the one to ask as I really don't know how to read them, but looks like lots of activity in the June calls.
small/med cap bios in general are getting hit pretty hard right now.
Since we're all speculating and all that, there has also been some pretty heavy option activity on MNTA lately :)
Agreed. And I'm going to once again predict we'll see another form 4 regarding selling today and probably more from yesterday.
Jerks. lol
Me neither but this one was all too obvious (form 4 just filed with large selling) with the volume/price action. I wonder if he and his firm are trying to completely unload.
I assume we'll see more sales today. All considering, the PPS has held up quite well in lieu of his selling.
Looks like same thing happened today with his sales
Actually I think the better move would have been better evaluating the two loony bin judges on the CAFC panel that overturned the injunction.
Considering they'll have a pretty large bucket of cash in the next 12 months or so and a very low burn rate, any ideas/speculation on what they'll end up doing with the cash?
Hah. Well you've done Jbog. You've surprised me. If that scenario were to transpire, I obviously hope you turn out to be correct.
What kind of revenues do you expect to MNTA if there was a simultaneous approval?
Sub 15 seems for certain and certainly 10-12 range is possible. It may put them close to neutral cash flow, although going forward there cash burn is even higher now, so I tend to think they're still be cash flow negative. I do expect a significantly higher cash flow from copax than enox if there are multiple players, however.
As you know, my bet is that MNTA gets sole approval though and for a significant amount of time. :)
I would expect the share price to go down significantly with a simultaneous approval.
Looks like ENTA is going unorthodox! :)
Enanta Pharmaceuticals Announces the Appointment of George S. Golumbeski, Ph.D. to Board of Directors
Enanta Pharmaceuticals, Inc. (ENTA) today announced the appointment of George S. Golumbeski, Ph.D., to its Board of Directors. Dr. Golumbeski will also serve as a member of the Compensation Committee and the Nominating and Corporate Governance Committees.
“Dr. Golumbeski’s professional experience in business development coupled with his scientific expertise will serve Enanta well as we continue to advance our internal programs and prepare to broaden our pipeline focus,” stated Jay R. Luly, Ph.D. President and Chief Executive Officer. “I look forward to his guidance and leadership on our Board.”
Dr. Golumbeski has nearly 20 years’ senior executive and business development experience in the pharmaceutical and biotechnology industry. Since 2009 he has served as Senior Vice President, Business Development at Celgene Corporation, a global biopharmaceutical company engaged in the discovery, development and commercialization of novel therapies for the treatment of cancer and inflammatory diseases, where he is responsible for business development, M&A, licensing, and partnership activities. Prior to Celgene, he was appointed Chief Executive Officer at Nabriva Therapeutics AG, where from 2008-2009 he redirected the company’s efforts and led the transition toward a development company. From 2002 to 2008, Dr. Golumbeski was Vice President, Business Development, Licensing and Strategy at Novartis-Oncology, a business unit within Novartis where he was a member of the Executive Committee which was responsible for the overall results of the business unit franchise. Previously he served as Vice President, Research and Development at Elan Biopharmaceuticals, where from 2001-2002 he was a member of the research and development management team primarily responsible for the research and development pipeline and drug candidate selection.
Earlier in his career, he held several business and corporate development positions of increasing responsibility at EMD Pharmaceuticals, Schwarz Pharma, Pierce Chemical Company and Promega Corporation.
Dr. Golumbeski received a B.A. in Biology from the University of Virginia, and a Ph.D. in Genetics from the University of Wisconsin-Madison. He completed his postdoctoral research in molecular biology at the University of Colorado-Boulder.
All indications say they are close to approving imo. The statement below tells me their stocking up for launch like they did before enox.
The ANDA for M356 is under active review by the U.S. FDA. The company and its collaboration partner, Sandoz, are preparing for the potential launch of this generic in 2014, pending U.S. FDA approval.
The post IPO selling for a bio of this size and % gain has been quite minimal I must say. I'll take that as a bullish sign :)
To be fair minimal was Teva's term, not mine :)
It's still early, but TEVA is saying the orals are having minimal impact on Copax. Good news for MNTA if they can get their generic approved.
The risk in ENTA has been greatly reduced after today's data imo. I have been adding more.
I would be surprised if it doesn't hit $40 today.
Wow great data... Very nice to see them moving up that launch data as well!!!
:)
On another note, if thrice weekly does pick up steam and garners any sort of significant market share, what would stop MNTA or MYL from submitting an ANDA for thrice weekly as well (assuming approval of their generic copax of course)?
I don't know much about the thrice weekly patents, but I can't see them being especially strong (could be totally off-base here)...
I'm going to guess she's talking about this statement:
“The availability of three-times-a-week COPAXONE® 40 mg/mL is a significant advancement for patients as they now have the option of effective and safe treatment with COPAXONE®, while reducing the number of injections by 60 percent,” said Omar Khan, M.D., Professor of Neurology and Chair of the Department of Neurology, Wayne State University School of Medicine, Detroit, MI. “Patients in the U.S. can now benefit from an improved dosing regimen without compromising the known benefits of COPAXONE®.”
Got to give it to Seth, he really believes in IDIX for whatever reason.
That may have been part of it, but bios in general got murdered in the first 3-4 hours of trading then came back towards the end there. I think that had a lot to do with it.
Also, Baird issued an outperform on ENTA with a PT of $41 after hours so folks may have got wind of that prior to today's close.
IDIX: Up 20% and currently around $1.1b cap... ?!?!?!?!?
Right. And this is in sharp contrast to MNTA executives who are adamant their copax is the same. Good info. Thanks for the response and I echo your sentiments.
Anything else new from Mylan on their Copax or just the same song and dance?
IDIX ho-hum results:
http://ir.idenix.com/releasedetail.cfm?ReleaseID=818775
Idenix Pharmaceuticals Reports Sustained Virologic Response Rate (SVR4) for Phase II All-Oral Combination Study of Samatasvir (IDX719), a Potent, Pan-Genotypic HCV NS5A Inhibitor, and Simeprevir
CAMBRIDGE, Mass., Jan. 13, 2014 (GLOBE NEWSWIRE) -- Idenix Pharmaceuticals, Inc. (Nasdaq:IDIX), a biopharmaceutical company engaged in the discovery and development of drugs for the treatment of human viral diseases, today announced interim data from the Company's ongoing phase II 12-week HELIX-1 clinical trial evaluating an all-oral, direct-acting antiviral (DAA) HCV combination regimen of samatasvir (IDX719), Idenix's once-daily pan-genotypic NS5A inhibitor, and simeprevir (TMC435), a once-daily protease inhibitor jointly developed by Janssen R&D Ireland and Medivir AB, plus ribavirin. The combination regimen was well-tolerated in the study. In the treatment-naïve, non-cirrhotic, genotype 1b or 4 HCV-infected patients receiving 50 mg of samatasvir and 150 mg of simeprevir plus ribavirin, 85 percent (n=17/20) remained undetectable for HCV RNA four weeks after completing therapy (SVR4). The 50 mg dose of samatasvir is the selected dose in the ongoing 3-DAA HELIX-2 clinical trial. The HELIX-1 study results are expected to be presented at a scientific meeting in 2014.
"We are pleased with the progress of our program with Janssen, including the announcement of the HELIX-1 SVR4 and safety data, as well as the recent initiation of a second phase II all-oral combination study, HELIX-2," stated Ron Renaud, President and Chief Executive Officer of Idenix. "We also have successfully completed the single-dose portion of the phase I/II clinical trial of IDX21437, a next-generation uridine nucleotide prodrug inhibitor, and the 7-day proof-of-concept portion of the study is underway. Based on these important developments, we are on track to initiate an Idenix-sponsored combination study of samatasvir and IDX21437 by mid-2014."
IDIX once again flirting with that $1b cap.
Any word on why UBS thinks IDIX is magically worth $1.5B now? I could only find the PT raise.
IDIX: UBS upgrade to buy and $11 PT.
Sure UBS, sure....
Hence the last line in my previous post jbog. Anyway, it was a joke. I'm not sure why it become such a hot topic on the MNTA board! :)
I didn't mock Teckor because of today's price. I poked fun because he only shows up here when the stock price is low or trending lower to rub it in with his "TA". He has never once been right about which way this stock is going. If he showed up right now and told me it was going higher, I would sell immediately, for instance :)
I think years of perhaps being a little to unrestrained might be playing a part :P
Now only if we could get a technical analysis from that teckor guy so we can do the opposite of what he says :) :P :)
And a new one for today FWIW
Any reason/insight for the disconnect b/t BoAs revised market share and the still too low peak sales?
I tend to disagree. If it was the lead candidate or a complete termination the market would have responded more. We really don't know the reason for the termination or if Bax will pick up another candidate in its place.
But to your point, yes this stock is all about M-Copax right now.