Biotech Values

[DewDiligence]

CEPH good news & bad news:

[The good news is a Provigil settlement with BRL, the fourth and final company who had challenged the Provigil patent. The bad news is that the FDA has extended the PDUFA date on Nuvigil (the single-isomer version of Provigil being developed for sleep dep and shift work) by three months. CEPH also inked a deal with BRL for a generic Actiq, but this deal is anticlimactic given the prior Actiq agreement between the companies that paved the way for CEPH to acquire Cima Labs in 2004 (#msg-3776755).]

http://yahoo.reuters.com/stocks/QuoteCompanyNewsArticle.aspx?storyID=urn:newsml:reuters.com:20060202...

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Cephalon, Barr settle patent disputes, shares jump

Wed Feb 1, 2006 7:48 PM ET

NEW YORK, Feb 1 (Reuters) - Cephalon Inc. ( CEPH ) said on Wednesday it has reached a settlement with generic drugmaker Barr Pharmaceuticals Inc. ( BRL ) in a U.S. patent dispute over the biotechnology company's flagship sleep disorder drug, Provigil, and its cancer pain drug, Actiq.
The company said the deal should keep intact Cephalon's Provigil patent protection at least until October 2011, removing a major uncertainty hanging over Cephalon and sending its shares 10 percent higher in after-hours trading.

Barr was the fourth and final generic drugmaker to challenge the Provigil patent with which Cephalon has reached a settlement agreement.

Under the agreement, Cephalon will grant Barr a non-exclusive royalty-bearing right to market and sell a generic version of Provigil, known by the chemical name modafinil, once the patent expires in either October 2011, or April 2012, should Cephalon obtain an extension for testing the drug for pediatric uses.

Cephalon previously reached similar agreements with India's Ranbaxy Laboratories Ltd., Israel's Teva Pharmaceutical Industries Ltd. and Mylan Laboratories Inc. ( MYL ).

Cephalon Chief Executive Frank Baldino called the agreement "a transformational event." "Continued Provigil sales provide a new foundation for further accelerating Cephalon's growth over the next several years," Baldino said in a statement.

Provigil, for the sleep disorder narcolepsy, had third-quarter sales of $134.5 million.

Cephalon also agreed to grant Barr an exclusive royalty-bearing right to market and sell a generic version of Actiq in the United States as of Dec. 6 this year. Barr agreed to pay specified royalties on net profits of generic Actiq for the period Dec. 6, 2006 through Feb. 3, 2007, Cephalon said.

Actiq had third-quarter sales of $100.3 million.

The companies are expected to file dismissal motions with the courts in which the patent litigation was pending, ending the lawsuits, Cephalon said.

Separately, Cephalon said the U.S. Food and Drug Administration has delayed by three months its review of the company's application for experimental sleep disorder drug Nuvigil, and it now expects to launch the drug by mid-year.

The FDA had been slated to decide on the application by January 31, but the deadline has been extended to April 30 in order to give the agency time to review additional information submitted last October, the company said.

Nuvigil is designed to improve wakefulness in patients suffering from excessive sleepiness associated with narcolepsy, shift work sleep disorder and obstructive sleep apnea/hypopnea syndrome.

Cephalon shares jumped to $77.60 in extended trading on Inet electronic brokerage from their close at $70.50 on Nasdaq.
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