Teva Pharmaceutical Industries Ltd.'s (NYSE: TEVA; TASE: TEVA) Copaxone war is over. It would be a mistake, however, to think that Copaxone is the only arrow in Teva's bow. Teva has been moving forward with a wide range of developments in recent year, including both generic and innovative drugs. The company's innovative portfolio is interesting, and includes a number of potential blockbusters.
An examination of Teva's innovative drug pipeline puts the flood of recent reports about Teva, some well-founded and other less so, in a different light. It is true that the expiration of the Copaxone patent is significant for the company, but it appears that Teva made important preparations for this event, which should be taken into account before writing off the company.
Background
For the most part, Teva is a generics company that attacks other companies' patents and makes its own generic versions of their drugs. In order to keep things in their proper proportion, keep in mind that Teva is the world's largest generics company and one of the world's leading pharmaceutical corporations, with 57,000 employees in 80 countries and sales of 16,000 different products in 100 countries.
As of the end of 2016, Teva had 87 manufacturing sites and 26 clinical R&D sites. The company produces 120 billion tablets a year, and its sales totaled $22 billion in 2016. The largest generics company in both the US and Europe, Teva is among the top three generics companies in 40 markets around the world.
Teva's innovative drug pipeline
Teva's innovative drug portfolio strategy focuses on attempt to provide a solution to patients whom it believes currently have no solution. Teva is concentrating on the central nervous system, including multiple sclerosis, movement disorders, degenerative diseases, migraines and pain, and respiratory disorders.
As of the end of 2016, Teva's innovative portfolio includes quite a few developments. Teva believes that it will obtain results of five clinical trials this year, leading to five request for US Food and Drug Administration (FDA) approval.
Furthermore, Teva expects approval for seven innovative drugs this year, after having received approval for three new innovative drugs last month (out of the seven waiting for approval). The already approved drugs are Fluticasone Salmeterol MDPI, Vantrella, and Fluticasone Propionate MDPI.
One important innovate drug currently in Phase III clinical trials is for treatment of migraine headaches. As of now, this drug has been developed into two types of drugs: one for chronic migraines and one for migraine episodes. Teva has continued this important development, and has also developed another drug for treatment of cluster headaches.
In principle, Teva does not provide monetary estimates for products in development, but forecasts by the analysts for development of its drugs for migraines and severe headaches mention a market of $3 billion a year in which there is currently no dominant drug.
In September 2016, Morgan Stanley investment bank analyzed the migraine treatment market, and estimated that Teva would achieve peak sales of $1.7 billion a year (in a possible range from $600 million to $3 billion).
A Citigroup report from March 2016 estimated that the products for treatment of migraines, movement disorders, and Huntington's Disease (Pridopidine) were likely to generate sales of over $5 billion a year. A report by JP Morgan from November 2015 estimated peak sales of the movement disorders products at over $1.5 billion a year. JP Morgan reiterated this estimate in May 2016.
In order to view Teva's innovate drug portfolio from the proper perspective, it is necessary to consider its sales and profits from Copaxone. Copaxone sales amount to $1 billion a quarter, generating an impressive $816 million operating profit.
Teva's innovative migraine drugs, which are consider potential blockbusters (in pharma industry terms, a blockbuster refers to a drug with projected annual sales of over $1 billion), are in Phase III clinical trials. Results for the drug for treating migraine episodes are expected in the second quarter, while results for the drug for treating chronic migraines a slated for the third quarter of the year.
Teva is expected to submit the two drugs for FDA approval in the fourth quarter of this year, with approval, if granted, likely to come in 2018. Teva is slated to obtain final approval for an innovative drug for treatment of Huntington's Disease in the first quarter of this year. The company also expects to receive final FDA approval in the second quarter for launching a drug for treating tardive dyskinesia (repeated undesirable movements), a drug also regarded as innovative with significant potential.
Published by Globes [online], Israel Business News - www.globes-online.com - on February 19, 2017
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