Copaxone patent court hearing opens Wednesday

Teva is suing several companies seeking to develop generic versions of the multiple sclerosis drug.

Teva is suing Mylan Inc. (Nasdaq: MYL), Momenta Pharmaceuticals Inc. (Nasdaq: MNTA), Novartis AG (NYSE:NVS; LSE: NOV; SWX: NOVZ) unit Sandoz, and India's Natco Pharma Ltd. for patent infringement, claiming that its Copaxone patents are valid through 2014-15.

In separate proceedings, the respondents are claiming that Teva is engaged in unfair conduct with regard to Copaxone, and that the patents are therefore invalid. Last week, the court issued a set of rulings favorable to Teva in its patent infringement Copaxone lawsuits.

Copaxone is Teva's largest selling drug, with $1.86 billion in sales in the first half of 2011. Sales of the intravenous drug grew despite the launch of oral multiple sclerosis treatments. Teva does not disclose how much Copaxone contributes to its net profit, but analysts estimate the figure at one-third.

Bernstein Research analyst Dr. Aaron (Ronny) Gal believes that a decision in the case will not come before mid-2012, because of the huge amount of material submitted to the court. He gives Teva an "Outperform" recommendation with a target price of $55, a 37% premium over yesterday's closing price on Nasdaq. He said, "Based on current stock price we would argue the stock is worth buying even if odds of Teva winning is 50%-50%"

Teva's share price has fallen over 13% so far in August, partly because of concerns over competition to Copaxone.

Teva's share price fell 2.5% on Nasdaq yesterday to $40.23, giving a market cap of $35.8 billion, but rose 0.6% by mid-afternoon on the TASE today to NIS 143.30.

Published by Globes [online], Israel business news - www.globes-online.com - on September 6, 2011

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