Dr Ehud Marom, formerly head of Teva's Copaxone activity and now CEO of drug development company Mapi Pharma, which is about to begin Phase III trials of delayed release Copaxone, believes that Teva will find it hard to distinguish its Copaxone from competitors' generic versions of the blockbuster multiple sclerosis drug. Marom, who founded Mapi Pharma, says, "It's true that it's difficult for generics companies to copy Teva's Copaxone, because, although the product is a chemical molecule and not a protein, it is composed of many protein parts and has no fixed molecular weight. Ultimately though the effort succeeded, and Mylan already sells 20mg dosage Copaxone. The difficulty in production did hold up the generics companies for a while, but they have overcome this hurdle, and it is now of no significance. The companies now know how to produce generic Copaxone, and they were only waiting for the patent to expire.
"Teva filed appeal after appeal with the FDA, which almost wore them out, but in the end they approved competition. Because of the complexity, there will not be dozens of competitors selling this product, but there will be a few, and so Teva can be expected in my view to lose 25-30% of its market share, as it did when it lost the battle over the 20mg dosage version.
"Does selling the original drug not give Teva some advantage? It certainly does; the ethical drug always has an advantage because doctors have greater experience in its use. So Mylan will cut the price, I estimate by about 30%, and then the insurance companies will bring pressure to bear to use the new product, and in time, Teva too will have to lower its price."
Globes: A 30% loss of market share and a 30% price cut sounds like the end of the world for Teva.
Marom: "It's bad, because Teva's profit margin on Copaxone is 90%, whereas on its generic products its margin is just 5-10%, next to nothing. The new dynamic in the Copaxone market will erode its profit a great deal. It's a pity that Teva took all the profit from Copaxone and invested it in Allergan."
On the Tel Aviv Stock Exchange this morning, Teva's share price is down nearly 13.5%.
Published by Globes [online], Israel business news - www.globes-online.com - on October 8, 2017
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