Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA) announced today that its standstill agreement with Wyeth/Altana regarding additional shipments by Teva of generic Protonix (Pantoprazole Sodium) has terminated as a result of Wyeth's launch of an authorized generic product. Protonix is a drug used to treat gastro-esophageal reflux disease (GERD).
Teva launched its generic version of Protonix on December 21, but agreed to suspend deliveries until January 31 as it negotiated with Wyeth. With talks stalled, Wyeth announced that it was unable to reach a settlement with Teva and will instead launch its own authorized generic version of Protonix with Prasco acting as its distributor.
As a result, Citigroup expects Teva to return to marketing its generic version of Protonix. The bank points out that it expects Teva "to retain a commanding market share lead as it already captured 58% prescription share for the week ended Jan 18; however, pricing will rapidly deteriorate."
Wyeth and Teva will take the case to trial, where Wyeth will attempt to recoup its claimed lost profits, though Citigroup points out that a verdict may not be reached until 2009.
Citigroup analysts view Teva's return to selling Protonix as favorable, and reiterate their "Buy" recommendation on the shares, claiming "Generic Protonix adds visibility to near-term growth as Teva prepares to update its long-term outlook in the next month. We continue to look for Teva to build on its strengths, including an industry-leading pipeline, continuing Copaxone growth, and exposure to emerging generics markets."
Shares in Teva closed at $44.39 on Nasdaq yesterday, up 0.9%, to reflect a market cap of $33.9 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on January 30, 2008
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