Replies to post #133476 on Biotech Values

[DewDiligence]

Clarification on Teva’s 2012 Copaxone forecast: Insofar as Teva’s corporate style does not allow an admission that Teva might lose the patent case, Teva did not qualify its Copaxone forecast according to whether a generic version launches in the US market.

[DewDiligence]

Copaxone has 40% TRx and 35% NRx in the US market, according to a piece in the Globes citing Morgan Stanley:

#msg-70509702

Teva raised the Copaxone price 15% yesterday, according to MS.

[DewDiligence]

4Q11 US Copaxone sales were ~$740M, although the number was not explicitly disclosed by Teva. This estimate is based on: i) the disclosed $1.0B of 4Q11 worldwide Copaxone sales; ii) the 74% share of worldwide Copaxone sales in the US market during 3Q11; and iii) the lack of pricing pressure for Copaxone in the US market, according to Teva.

The $740M estimate above is consistent with Teva’s guidance for the full year 2012, which implies about $2.8B of US Copaxone sales (#msg-70158971). Teva’s 2012 sales guidance excludes the launch of a generic, of course.

[DewDiligence]

Re: Projected 2012 US Copaxone sales

1Q12 US Copaxone sales reported today by Teva were $617M, -1% vs 1Q11, and -17% vs my estimated figure for 4Q11 (#msg-72138967):

http://ir.tevapharm.com/phoenix.zhtml?c=73925&p=irol-newsArticle&ID=1693594&highlight

In the U.S., in-market sales slightly decreased 1% to $617 million, as a result of the renegotiation of certain distribution services agreements so as to establish a new fee structure, partially offset by price increases.

In other words, the average US selling price after discounts and rebates declined relative to prior quarters. In 1Q12, US Copaxone sales were 68% of the worldwide total, down from an average of 74% in prior quarters.

Teva did not formally change its guidance given in Dec 2011 for $3.8B of worldwide Copaxone sales in 2012 (#msg-70158971); however, if we assume that the proportion of worldwide Copaxone sales from the US remains at 68% (rather than the prior 74%), then Teva’s guidance implies 2012 US Copaxone sales of about $2.6B. Ignoring quarterly variation and simply multiplying the 1Q12 figure of $617M by four gives $2.47B. Thus, it seems reasonable to infer that 2012 US Copaxone sales will be in the range of $2.4-2.6B. (This range assumes no launch of a US generic Copaxone in 2012.)