Biotech Values

[DewDiligence]

Agreed that an authorized generic for Copaxone is likely; it is also consistent with the premise of my previous post that Teva may continue to detail Copaxone even after it goes generic. By launching an AG, a higher proportion of the incremental sales of all Copaxone products stemming from Teva’s continued detailing will flow to Teva itself because the AG will also benefit indirectly from the detailing.

Moreover, because Copaxone does not use a biologic as feedstock, Teva does not have a capacity constraint (in contrast to SNY’s situation with Lovenox), so the kind of duopoly we’re seeing with Lovenox is inherently less stable in the Copaxone market.

(The above aspects of the Copaxone market are (IMO) more consequential to the impetus for Teva to launch an AG than the distribution channel you spoke of.)

Fortunately, MNTA gets the same 50% share of NVS’ operating profit from Copaxone whether or not there is an AG in the market, so (unlike Lovenox) a Copaxone AG is not something that MNTA investors need to be unduly concerned about.