Momenta Pharmaceuticals, Inc. (MNTA)

[DewDiligence]

Re: District Court Copaxone ruling

We have to wait for the actual Order from the District Court to see if it includes an injunction against the FDA. Some patent rulings contain such an order and some don’t; even Teva didn’t know for sure whether the ruling in this case would include an injunction against the FDA, which is why Teva’s PR of 6/23/12 (#msg-76901539) employed the waffle word should in the following sentence:

This ruling should prevent the FDA from approving, and the defendants from selling their purported generic versions of Copaxone in the U.S. until the Orange Book patents expire on May 24, 2014 [emphasis added].

(Had Teva been certain of an injunction against the FDA, Teva’s language in the above sentence would presumably have used the word will instead of should.)

The uncertainly about an injunction against the FDA stems from the fact that Hatch-Waxman law does not restrict the FDA’s options once the 30-month stay pursuant to a paragraph-IV challenge has expired. Thus, in this instance, the FDA can be barred from issuing a final approval of MNTA’s Copaxone ANDA only by an explicit Order from the Court.

Inasmuch as MNTA has acknowledged that it will not launch Copaxone at-risk under any circumstances, from a practical standpoint it makes no difference to MNTA investors whether the FDA issues a tentative approval or a final approval of the Copaxone ANDA. In either case, the approval will be consequential and can be expected to boost the share substantially by re-validating MNTA’s technical prowess in replicating complex drugs and by guaranteeing that generic Copaxone can be launched at the expiration of Teva’s Copaxone patents (or sooner in the event of a settlement or reversal of the District Court on appeal).

The only way I can envision FDA approval of MNTA’s Copaxone ANDA not boosting MNTA’s share price substantially is if the FDA approves MYL’s Copaxone ANDA too.