Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA) has won a significant increase in the number of molecules for which it can contract to supply during 2008-2009 to German healthcare provider Allgemeinen Ortskrankenkassen (AOK), compared to the six products it was awarded in the first tender earlier this year.
The current AOK tender is for the supply of 83 active pharmaceutical ingredients (APIs), worth €1.2 billion altogether. AOK is dividing the tender among different suppliers. AOK represents 25 million of the approximately 70 million publicly insured people in Germany. Novartis AG (NYSE:NVS; LSE: NOV; SWX: NOVZ) is another participant in the present tender. Teva had previously won six out of the ten offers it submitted in an earlier AOK tender for 46 APIs.
Teva said that the agreement expands its presence in the German generic market, which is Europe’s largest generic market with approximately €8 billion of sales, based on IMS sales data.
The tenders are the result of recent changes in Germany’s legislation, which now entitles health funds to negotiate discounts for products directly with manufacturers. Manufacturers selected by AOK via its official bidding process will become one of three preferred suppliers of a specific finished dosage product over a two- year period. Preferred products will be selected by doctors and pharmacists prescribing and dispensing, respectively, to AOK patients.
In July, Teva German division manager Michael Ewers has told "Thomson Financial News" partner dpa-AFX, "We cannot be satisfied ranking 22nd and having a market share of about 1%."
Earlier this year, Teva lost a tender for the generic business of Merck KGaA (XETRA:MRK), which Mylan Laboratories Inc. (NYSE:MYL) acquired for €4.9 billion ($6.7 billion).
Published by Globes [online], Israel business news - www.globes.co.il - on September 19, 2007
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