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It will take the judge 2-4 months to make a decision on the substantive case at hand (outside the preliminary injunction). I don't think Sanofi will automatically appeal if they lose... I suspect they were gunning for a PI (to try to hold on to their monopoly for a little while longer). It didn't help that their approach (running to the courts upon release of a generic) was EXPLICITLY AND BRUTALLY slammed by FDA counsel at the hearing. (SANOFI take NOTICE)
Canaacord Adams analyst expects a injunction decision by tomorrow (8/19). So i think we should have one by early next week.
That would be highly unlikely in light of tevas response to news of momenta's mL approval.
Agreed. There are numerous reasons that make it difficult for Sanofi to meet the high threshold for a PI. The sovereign immunity argument was interesting, but it doesn't give Sanofi "per se" irreparable harm.e
FDA cited to "Gulf Oil Corp. vs. DOE", where the court did a wonderful job analyzing "irretrievable losses" (i.e. sovereign immunity) in the context of a PI/irreparable harm analysis.
I found the excerpt below from that case particularly insightful ... with respect to irreparable damage, it appears indistinguishable from Sanofi v. FDA.
"Thus, in every case cited by Gulf, there are two elements to irreparable injury; these are an irretrievable monetary loss, and resulting damage which cannot be estimated in terms of money, and cannot be redressed by money. In this case, only the former element is present. The court concludes that this is not enough. This is a close question, because there is some appeal to the proposition that any damage, however slight, which cannot be made whole at a later time, should justify injunctive relief. However, some concept of magnitude of injury is implicit in the Virginia Petroleum standards, under which, if plaintiff shows irreparable injury and likelihood of success on the merits, the court must then weigh against this the injury to defendant, and the public interest. While perhaps leading to some confusion, the courts appear to treat some threshold level of this balancing, sub silentio, under the irreparable injury prong of the analysis. The result of this balancing process appears to be that the injury must be more than simply irretrievable; it must also be serious in terms of its effect on the plaintiff. Under this standard, it is apparent that Gulf will not suffer irreparable harm even if the monetary loss is irretrievable...."
The $2.5 billion in U.S. sales generated by Lovenox in 2009 amounted to only 6 percent of the company’s overall annual revenue. Even if Sanofi were to lose some portion of those sales as a result of competition from Sandoz, the resulting financial harm would be far too insignificant to cause “extreme hardship” to Sanofi overall, much less threaten its existence.
I suspect that the preliminary injunction ruling will come quickly (tomorrow or at the latest, the next few days). The full case will likely take 4-6 months to litigate.
wish i could see that. I am interested to see how the FDA responded to the irreparable harm/sovereign immunity argument set forth by Sanofi.
A PI, if granted, would likely cause irreparable harm to Sandoz. Thus, granting of one is likely "a wash", and I suspect the judge would want to maintain the status-quo. (thats my guess as a non-practicing attorney). It helps that the judge already refused to issue a TRO at the scheduling conference.
I wonder what the FDA said in their surreply to Sanofi's sovereign immunity argument...
in light of what was said at the recent conference call, we can extrapolate reimburseable expenses to a reasonable certainty. (This analysis has been previously posted on iHub, so I won't go there...)
That being said, the PPS moving below pre-approval levels is quite curious and out-of-line with a worst case scenario (TEVA approval and AG)
ThomasS, if I had a few hundred million, I would buy some nice big chunks of MNTA. It is a great risk/reward. The sell-off is quite baffling, one can only wonder why. I do think that the material event that led to the short-term "price collapse" (hopefully very short-term) was when Tim Anderson (Bernstein analyst) came out and claimed that TEVA would get approval for m-Enox very soon (based on some "information" he had -- of course he wouldn't share this top secret information....) :)
I will be interested to see if this selling pressure is coming from long-time holders OR if this is being shorted....
It WAS known that Momenta would have to reimburse Sandoz for development costs upon approval of m-enox. (In fact this had been discussed on this board for weeks in advance of the approval announcement)
The specific formula for reimbursement (capped at 50% of revenue per quarter) was not known. MNTA coming out and explicitly noting that they expect to fully reimburse Sandoz in 3 quarters is also a new tidbit of information.
In light of the above, your assertion that the market sold MNTA off because of this news is without merit.
Very hard to predict what the stock will do. i was convinced the floor would be 18.5. when it got to 15.98, it was utterly baffling. I'm shocked that the stock moved higher pre-approval (was ~16.50 pre-approval and hung out in the 15's for weeks) than a seemingly best case post approval scenario. Does that seem bizarre to anyone else? Moreover, the stock moved to 30$ in 2005 on the lovenox patent news.
Everytime i think i understand these markets, i get a lesson in the woodshed with uncle MM.
Actually, the cowen analyst did come out and say that they believe "MNTA will have the sole generic m-enox for the foreseeable future."
They believe m-enox alone is worth "mid-30's" to MNTA.
2011? just wait a few days.... :)
A positive FDA response next week would send it up quickly to IMHO around 19.
What FDA response are you talking about?
it is a hugely inefficient price. either our board has it wrong BIG TIME or the market will send MNTA significantly higher (in the near future).
Sandoz is making about 1 million $ per day from Lovenox. 6 Weeks = 42 Days. (40 million / 42 days) = ~1 million $'s per day! All that work for only a million a day. (for now)
Nice to see you here zipjet!
MNTA: Cool ... if TEVA received approval today, I think MNTA at these levels would still be a good buy.
Yea, but you are totally objective with all your missed calls and bogus "seasonal patterns" ... each time your call fails, you make up some excuse.
Well the Oppenheimer/Cowen/Wedbush/Rodman analysts are all being contradicted by Bernstein. These analysts have all come out and stated that MNTA should have the sole generic for the foreseeable future and that it is significantly undervalued. Some came out after the Sanofi lawsuit and said to buy on weakness. If this isn't weakness, i don't know what is. I expect some reiteration and clarification.
I do think that the Sanford Bernstein analysts is copping out using the old scare tactic ... "i have it on good information that...." (without citing a source or clarifying further). How can you call yourself an "analyst" and do that, and how can it be tolerated by the SEC? I do agree that its better not to get upset and just ride the wave.
MNTA: Cowen Analyst (7/27)
Cowen believes Sandoz /Momenta will remain the sole generic for lovenox for the foreseeable future and that M-enoxaparin is worth mid $30 's/share to Momenta (MNTA).
MNTA: Oppenheimer 7/26 Analyst:
Oppenheimer thinks there is a good chance that Momenta's M-enoxaparin may be the only generic version of Lovenox, and the firm maintains an Outperform rating on Momenta. (Price Target: $34)
MNTA: Piper Jaffray Analysis: 7/27 - Piper Jaffray believes the sell-offs in Teva (TEVA) and Watson Pharma (WPI) after the FDA approved Sandoz and Momenta's (MNTA) generic version of Lovenox were overdone. Piper believes the FDA is unlikely to approve Teva and/or Watson's aNDA filings on Lovenox in the future, but points out most analysts did not incorporate such approvels into their models anyway.
The game is not over yet. September expiration is many days away. This can easily pop in the interim. Markman hearing news, partnership, or something from left field and we could be back in the mid-high 20's in a flash. I would encourage you to keep that in mind as you mull your "play" going forward
In the event of a non-substitutable approval for TEVA, MNTA sole-generic royalty structure would remain in-tact.
Sanofi AG decision would depend on what Sanofi wants to do ... i suspect they would refrain from a AG in such a scenario.
Please refer to Dew's Readmefirst for more detailed discussion around the aforementioned scenario.
non-substitutable.
Interesting that the Bernstein analyst had no note about Generic Copaxone. Well, at least this explains the "weakness" of the past few days. I look forwad to the reversal.
MNTA: Added this morning. Did everyone forget about the rest of the pipeline? Generic copaxone is next up for Momenta.
I for one was being facetious (note that I asked DewDiligence about his thoughts on my assertion that markets were efficient -- have you seen his message footer?)
You do know that back in March of 2007 the Dow was trading at ~12,000. It is now approaching ~11,000.
Furthermore, the AMEX Biotechnology Index was trading at ~750 in March of 2007, it is now trading at 1,110. Quite a "collapse" for biotech, wouldn't you say ...
Clearly your memory and/or your basket of small-cap biotech is selective to your own "theory" .... and your recalcitrance about my being "dismissive" is quite ironic (since you qualify the examples i gave as "exceptions" ... have you considered that maybe JAZZ or the other examples you cited are the exception ... or have you considered that maybe the world is not black and white and you shouldn't generalize so much about everything)
FACTS:
1) On March 20th, 2007, Alexion Pharma (ALXN) received FDA approval for the first therapy approved for paroxysmal nocturnal hemoglobinuria (PNH), a rare, disabling and life-threatening blood disorder defined by chronic red blood cell destruction, or hemolysis.
- It ran to 22 $'s per share that month (March 07) on news of the approval (from a low of $17).
- It ran to 25 $ by May 07
- It ran to 30 $ by August 07
- It ran to 40 $ by October 07
2) Lev Pharmaceuticals was bought out by Viropharma 3 months after receiving FDA approval for Cinryze, for treatment of both acute and prophylactic hereditary angioedema (HAE), also known as C1 inhibitor deficiency. The company was purchased by Viropharma at a 30% premium over levels traded post FDA approval for Cinryze.
LEVP (Lev Pharma) went higher after its approval .... ALXN is another great example of going higher after its approval spike. Another invalid generalization by our friend WallstarB (do you still have a black and white television set Wallstar?)
Wallstarb!!!! see
I think its Sanofi and TEVA taking out their frustration by naked shorting MNTA through front-companies in the Grand Cayman islands. those punks....
Most of the members think the market needs time to digest the news and "study up" on MNTA ... i don't think that is true because markets are extremely efficient and get to "true value" sooner rather than later... don't you agree Dew?
There are also so many conspiracy theorists who think the price is "being held down" or that the "big boys are shorting" so they can get in at cheaper prices.... that also makes no sense.
I can't imagine fear of the lawsuit or fear of TEVA approval could keep the price so contained, it just doesn't make any sense to me.
silly is a nice way to put it. I have some other choice words to describe the price, but i'll keep those words to myself.
Wish I had more $$$ ... MNTA looks so tasty.
Don't forget the other side of the trade --- people write PUTS and take in premium. I'm sure that the 100% runnup in the stock is giving the MM's plenty of ammo to bid at a decent premium to those willing to write.
It's very hard to read into the rationale surrounding PUTS. Someone could also be buying those as a hedge to a long share position.
MNTA has now been rangebound for 6 days in the low 20's ... i think we see some action sooner rather than later.
Sept. put interest is very high ... 19$ Sept put is one of the most active PUTS on the CBOE today.
welcome vin .... talk about getting to the party late, but not missing the main event. :)
See the 5 day chart of MNTA Sept. 2010 ... 17.5 Put vs. 17.5 Call price hx...
http://twitpic.com/2b5cg3