Biotech Values

[MTdinanM3]

Leerink's take on MNTA

Thanks Wallstarb. What kind of news feed do you use btw? I just use the feed through my ThinkorSwim brokerage but it didn't pick up these reports. I had to visit TheMarkets.com to pick them up, which my hedge fund buddy has a subscription to.

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12/2/2009
MOMENTA PHARMA, INC.
District Court Decision to Not Add 3 Patents for Copaxone a
Positive for M-356

• Bottom line: The Southern District Court of New York's denial of TEVA's motion to add three patents for Copaxone increases our confidence in MNTA's ability to ultimately prevail with M-356. We find it interesting that TEVA did not issue a press release highlighting this decision, and believe that MNTA shares should regain their uptrend which was interrupted by TEVA's motion which it publicized on 11/10.

Reiterate Outperform and $16 fair value estimate.

• The court's quick, half-page decision filed yesterday confirms our suspicion that TEVA's motive was as much to delay MNTA as it was to add meaningful patent defenses at this advanced stage of the legal process, by ruling: "Because it would be impossible to complete discovery on the new claims by the December 31, 2009 discovery cutoff, and for the additional reasons as to undue delay and prejudice set forth in Sandoz's opposition papers, the court withdraws its November 30, 2009 order and denies TEVA's motion to amend."

• Next up: Markman hearing to help define the scope of the patent case for M-356 (generic Copaxone). The Southern District Court of NY has a scheduling hearing on 12/9, when the date for the Markman hearing will be set, if it isn't done before then. TEVA and MNTA will then set out a list of claim terms whose definitions are in dispute. To clarify the meaning of these terms (and subsequently the scope and validity of the patents), a judge will weigh evidence and definitions as presented by the parties and make a ruling in the form of a Markman Order to determine claim construction. MNTA is pleased with the pace of the case to date and believes the IP court process could be completed before the time at which TEVA's 30 month stay expires in 1Q:11.

• We continue to believe that M-356 could get around the 7 Copaxone patents. The first 5 patents are process patents and could simply be avoided by using a non-infringement claim if MNTA can synthesize copolymer-1 through a unique mechanism. MNTA's paragraph IV could take out Copaxones' 2 composition-of-matter patents, '539 and '098, through a non-infringement claim since the Copaxone label includes copolymer-1 mixtures with average weights of 4-11 KDa, whereas the composition of matter patents only cover 4-9 KDa. Inequitable conduct also seems to apply since glatiramer acetate had been thought useful in MS for decades prior to TEVA.