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Movers and Shakers, Apr. - Jun. 2010 -- Pharma Matters Report


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In this quarterly report, we look at a few of the companies beginning to make their marks on the US generics market either with their fi nished dose products or active ingredients, and analyze trends and statistics relating to the market as a whole.

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Movers and Shakers, Apr. - Jun. 2010 -- Pharma Matters Report

  1. 1. Image CopyrIght: iSTOCKpHOTOMOVERS AND SHAKERSA PHARMA MATTERS REPORT.April-June 2010 The Thomson Reuters quarterly report on the US generics industry using strategic intelligence and competitive analysis information from Newport Premium™, the critical product targeting and global business development system from the industry authority on the global generics market.
  2. 2. In this quarterly report, we look at a few of the companies beginning to make their marks on the US generics market either with their finished dose products or active ingredients, and analyze trends and statistics relating to the market as a whole. For more information on Thomson Reuters API Intelligence solutions, including Newport Premium, visit MATTERS | MOVERS AND SHAKERS
  3. 3. SeCTiOn i: inTrODuCTiOn WHAT iS An AnDA?The European Generic Association had its annual meeting in Romein June 2010. Attendees concluded that conditions look positive An Abbreviated New Drug Applicationfor the US generic market while the European generic industry (ANDA) is the firstcontinues to struggle with delays to generic launches, disincentives step for a genericfor generic prescribing in a number of countries, increasing pricing drug in the US. Itpressures, and government-mandated price cuts. is submitted to the FDA to prove thatWhy does the situation look better in the US? First, a large the generic versionnumber of products will lose patent protection over the next few is bioequivalent toyears. Second, the pricing environment in the US has stabilized. the innovator drugRichard Silver from Barclays Capital explained that the relative in question. On approval, the genericpricing stability is the result of industry consolidation over the version is addedpast 10 years and explained that the remaining competitors to the Approvedare more rational in their pricing strategies. Third, generic Drug Products Listpenetration is occurring at ever-increasing rates. For example, (“Orange Book”) andUS generic substitution today occurs at 80 percent conversion the company may manufacture andover four to six weeks as compared to 60 percent within six to market it. An ANDAeight months just a few years ago. Drivers accounting for the may be submittedrapid substitution rate include drug retailers’ increased focus on before the patent onaggressive generic substitution with higher profitability, the rise the innovator drugof authorized generics, and therapeutic substitution. expires. However, in that case, theThe future is not all rosy, however, for the US generic industry. ANDA must include aRaymond De Vre from McKinsey and Company warned the certification indicating that the filer doesaudience that the good times generic companies have enjoyed not seek to marketover the past decade will end soon. While the global generics the product beforemarket shows attractive growth with significant patent expiries the expiry of thefor small molecules occurring in 2011 and 2012, there will Orange Book-listedbe fewer small molecule opportunities after 2012. Although patents (“paragraph III certification”) orbiologics present a large opportunity for generics beyond 2010, that the filer believesthe manufacturing and regulatory hurdles are high and it that its productremains to be seen how many companies can realistically invest does not infringe thein these products for the long term. Orange Book-listed patents or that theMr. Silver expected industry consolidation to continue. Orange Book-listedHowever, he predicted that the majority of M&A activity will patents are invalidbe focused outside the US. Certainly, there was a significant (“paragraph IVamount of M&A activity in the second quarter, and, as seen in certification”).the Notable Deals section of this report, there were a number of WHAT Are “A”deals focused on emerging markets. rATeD DrugS? “A” rated drugs are considered therapeutically equivalent and can be substituted for each other. “A” rated drugs are designated as AA, AB, AN, AO, AP, and AT in the Orange Book. PHARMA MATTERS | MOVERS AND SHAKERS
  4. 4. WHAT iS A SeCTiOn ii: AnDA ApprOvAlS uS Dmf? TOTAl ‘A’-rATeD AnDAS by COunTry Of Origin Of A DMF (Drug Master AppliCAnT fOr April TO June 2010 File) is a confidential document 62 covering a specific manufacturing facility, process or 44 article used in the manufacturing, processing, packaging or storing of a bulk drug. A DMF is reviewed by the 11 10 FDA only if an ANDA 6 or NDA referencing 3 3 2 1 1 1 1 1 1 that particular DMF is filed. An ANDA or NDA will not be A A Y ZE E L SW D EN N S Y D AU N CA A DA AN AL approved until any AN ND US DI RI AN AN PA A RA ED NA IW RD ST IT IN JA RM LA RL EL IS TA issues with the DMF JO IC ER GE TH IT are resolved. SW NE WHAT iS THe 180- During the second quarter of 2010, US-based companies DAy exCluSiviTy? received the most Abbreviated New Drug Applications (ANDA) In order to encourage approvals, with 62 approvals going to 24 groups. During generic companies the same period, 19 Indian companies received a total of 44 to develop non- infringing products approvals. The approval numbers were considerably higher than and challenge invalid during the first quarter, when US-based companies received 23 patents, the Hatch- approvals and Indian companies received 22 approvals. Waxman act provides the incentive of grOupS WiTH THe mOST ‘A’-rATeD AnDA ApprOvAlS 180 days of market fOr April TO June 2010 exclusivity for the first 18 company to file an ANDA with paragraph IV certification for a product. The FDA may not approve additional ANDAs for 9 9 a period of 180 days commencing from 6 6 6 6 the first commercial 5 5 4 4 4 marketing of the first-to-file product. In cases where more than one ANDA with Paragraph IV nc nc td nc G d G p td d d KG ou Lt Lt Lt sA sA certification is filed sL sL sI sI sI im Gr b n a ie al al iu rti rie rie m La pi he or tic en tic va ys Lu ar st st co on the same day, the at el eu eu es No Ph du dd du Ar ng r Fr bo ac ac In In Re o es rI m m nd La al al period of exclusivity ge rid Dr ar ar tic bi tic n rin Ph Ph St yla ro eu eu eh Au may be shared. nt n M ac ac so Bo ge m m at ar ar Sa W Ph Ph va n Su Te During the second quarter of 2010, Mylan (US) received 18 ANDA approvals, putting the company on top of the list, followed by Sagent (US) and Teva (Israel), each with 9 approvals.PHARMA MATTERS | MOVERS AND SHAKERS
  5. 5. SeCTiOn iii: pArAgrApH iv CHAllengeS WHAT iS A biOSimilArIn the second quarter of 2010, we learned of the first Paragraph ACCOrDingIV patent challenges on six new active ingredients or TO uScombinations, down from 13 during the previous quarter. regulATiOnS?grOupS WiTH THe mOST pATenT CHAllengeS On reCOrD A biosimilarAS Of June 2010 product is defined in the Act to mean a biological product 152 that is both “highly similar to the reference product notwithstanding 83 81 minor differences 62 in clinically inactive 60 components” and 43 41 35 34 for which “there 30 28 27 are no clinically meaningful differences between the biological product and the Te No M W Ap Su Dr Ac Da Lu Pa Im yla at va pi ta pa rP n ot iic va Re so n Ph vis reference product in n ex hi Ph xL rti ha dd Lt n La ar sA Sa In Gr ar rm ab Ph d ys bo m c m nk ou G o terms of the safety, ac ar ac Gr ra ra ac yo p m e eu to ou to eu ut Hf ac Co rie r tic ica p tic purity, and potency ie eu sI Lt al sI al lC tic d nc nc In In om al of the product.” du du sI pa st st nc rie ni rie Interchangeability es sL sL In td td c is defined as a biological product that “may beTeva continued to be by far the most prolific filer of ANDAs with substituted for thepatent challenges. At the time of writing this report, we were reference productlinking the company to challenges on 152 products, up from without the149 products the quarter before. Novartis (Sandoz) and Mylan intervention of the healthcare providerwere in second and third place, with links to 83 and 81 patent who prescribed thechallenge products, respectively. reference product.” PHARMA MATTERS | MOVERS AND SHAKERS
  6. 6. prODuCTS firST expOSeD TO pArAgrApH iv CHAllengeS, AS repOrTeD by WHAT iS A pArAgrApH iv THe fDA beTWeen April AnD June 2010 CHAllenge? ACTive ingreDienT: • Perrigo has submitted an ANDA with Paragraph IV Bioequivalent butoconazole nitrate certification for a generic version of Gynazole-1 (butoconazole generic versions of pOSTeD by fDA: nitrate) vaginal cream. drugs that are not June 8, 2010 protected by patents • The Orange Book lists two patents covering Gynazole-1 can be produced and brAnD nAme: vaginal cream. marketed in the US by gynazole-1® - US Patent 5,266,329 will expire on Nov. 30, 2010. any company, subject to FDA approval. nDA HOlDer: - US Patent 5,993,856 will expire on Nov. 17, 2017. Kv pharmaceutical However, a generic Company - KV has alleged that Perrigo infringes US Patent 5,993,856. company may obtain • At the time the first ANDA with Paragraph IV certification was FDA approval before patent expiry if it submitted for a generic version of Gynazole-1 vaginal cream, certifies its product Gedeon Richter, Mediolast, and Roche Palo Alto held DMFs does not infringe for butoconazole nitrate. the listed patents or the patents are ACTive ingreDienT: • Apotex and Teva have submitted ANDAs with Paragraph invalid (paragraph IV eletriptan IV certification for generic versions of Relpax (eletriptan certification). Patent hydrobromide hydrobromide) tablets. holders may then sue pOSTeD by fDA: the ANDA filer for • The Orange Book lists two patents covering Relpax tablets. June 8, 2010 patent infringement. If - US Patent 5,545,644 includes claims directed to the drug the patent holder sues brAnD nAme: the ANDA filer within relpax® substance, drug product, and the treatment of migraine 45 days of notification, with or without aura. It will expire on Dec. 26, 2016. nDA HOlDer: the FDA may not pfizer - US Patent 6,110,940 is directed to a crystalline form of approve the ANDA for eletriptan hydrobromide. It will expire on Aug. 29, 2017. 30 months from the date of notification. If - Pfizer has alleged that Apotex and Teva infringe US Patent no suit is filed within 6,110,940. In its notification letter, Apotex asserted that its 45 days, the FDA may proposed product would not infringe the patent because approve the ANDA at it would contain an amorphous solid form of eletriptan any time. hydrobromide. Teva also indicated that its proposed product would not contain the polymorphic form of eletriptan hydrobromide claimed in US Patent 6,110,940. • At the time the first ANDA was submitted for a generic version of Relpax tablets, Teva and Apotex held DMFs for eletriptan hydrobromide. ACTive ingreDienT: • At least one company has submitted an ANDA with eprosartan mesylate Paragraph IV certification for a generic version of Teveten pOSTeD by fDA: (eprosartan mesylate) tablets. We do not know the filer’s June 22, 2010 identity at this time. brAnD nAme: • The Orange Book lists only one unexpired patent covering Teveten® Teveten tablets. nDA HOlDer: US Patent 5,656,650 includes claims directed to the use of Abbott eprosartan stepwise or in physical combination with a diuretic for the treatment of hypertension. It will expire on Aug. 12, 2014. • At the time the first ANDA was submitted for a generic version of Teveten tablets, Jubilant Organosys and Hetero Drugs held the DMFs for eprosartan mesylate most likely to be referenced in an ANDA.PHARMA MATTERS | MOVERS AND SHAKERS
  7. 7. ACTive ingreDienT: • At least one company has filed an ANDA with Paragraph IVketoconazole certification for a generic version of Extina (ketoconazole)pOSTeD by fDA: foam. We do not know the filer’s identity at this time.may 18, 2010 • The Orange Book lists only US Patent 7,553,835 for ExtinabrAnD nAme: foam. That patent includes claims to the drug product and itsextina® use in the treatment of seborrhea dermatitis. It will expire onnDA HOlDer: Oct. 19, 2018.gSK • At the time of the first ANDA submission for a generic version of Extina foam, several companies held active DMFs for ketoconazole. This is not surprising because other generic ketoconazole products have been approved in the US for years.ACTive ingreDienT: • Lupin has submitted an ANDA with Paragraph IV certification for aranolazine generic version of Ranexa (ranolazine) extended-release tablets.pOSTeD by fDA: • The Orange Book lists 10 patents covering Ranexa extended-June 8, 2010 release tablets, all expiring on May 27, 2019.brAnD nAme: Lupin’s ANDA for a generic version of Ranexa includedranexa® Paragraph IV certification to all 10 patents. Roche and GileadnDA HOlDer: have alleged infringement of nine of the patents.gilead • The FDA reported at least eight active DMFs for ranolazine on file at the time the first ANDA was submitted for a generic version of Ranexa extended-release tablets, including one held by Lupin.ACTive ingreDienT: • Mylan has filed an ANDA with Paragraph IV certification for asunitinib malate generic version of Sutent (sunitinib malate) capsules.pOSTeD by fDA: • The Orange Book lists three patents covering Sutent capsules.April 19, 2010 - US Patent 6,573,293 and US Patent 7,125,905 include bothbrAnD nAme: drug substance and drug product claims directed to SutentSutent® capsules. They will expire on Feb. 15, 2021.nDA HOlDer:pfizer - US Patent 7,211,600 claims the treatment of gastrointestinal stromal tumors with sunitinib. It will expire on Dec. 22, 2020. - Pfizer has alleged that Mylan infringes all three listed patents. • At the time of the first ANDA submission for a generic version of Sutent capsules, Teva held the only active DMF for sunitinib malate reported by the FDA. PHARMA MATTERS | MOVERS AND SHAKERS
  8. 8. SeCTiOn iv: nOTAble DeAlS Much of the deal making activity in Q2 involved big pharmaceuticals expanding their presence in rapidly developing, emerging generic markets in India, Latin America, and Japan. AbbOTT One of the most active deal makers in Q2 was Abbott. After obtaining a diverse portfolio of branded generics products and significant presence in emerging markets by acquiring Solvay Pharmaceuticals at the beginning of the year, Abbott agreed to pay $3.72 billion for Piramal Healthcare’s Indian formulations business in May and announced collaboration with Zydus Cadila. The acquisition, which also gives Abbott a production facility at Baddi, is expected to close during the second half of 2010. According to Abbott, the deal will give them the No. 1 position in the Indian pharmaceutical market. The collaboration agreement between Abbott and Zydus Cadila covers the development and commercialization of branded generics in 15 emerging markets. Initially, Abbott will commercialize 24 products from the Zydus portfolio with an option to commercialize more than 40 other products. The products cover a number of therapeutic areas, including pain, cancer, respiratory, neurological, and cardiovascular diseases. pfizer Pfizer, meanwhile, announced in May that it had entered into two more collaboration agreements with Strides Arcolab of India. Recall that in January, Pfizer expanded an earlier arrangement with the Indian generic company, Strides Arcolabs, for the supply of 40 off-patent products, including mostly injectable anti-cancer treatments. One of the May agreements covers 38 generic oncology products which Pfizer will commercialize in the EU, Canada, Japan, Korea, Australia, and New Zealand. The second agreement involves Pfizer commercializing niche sterile injectables in the US SAnOfi-AvenTiS In the second quarter, Sanofi-Aventis announced a joint venture with Japan’s Nichi-Iko to boost its profile in the fast-growing generic drug market in Japan. The company’s goal is to be in the top five generic drug producers in the Japanese market within five years. For more information about the opportunities and challenges foreign companies face in pursuing Japan’s generic market, download our white paper, The Japanese Generic Drug Market: Opportunities and Strategies for Success, at MATTERS | MOVERS AND SHAKERS
  9. 9. glAxOSmiTHKlineGlaxoSmithKline expanded its business in Latin America byacquiring Laboratorios Phoenix in Argentina. Phoenix has abroad portfolio of branded generics covering therapeutic areasincluding cardiovascular, gastroenterology, metabolic, andurology. The deal also includes a manufacturing facility nearBuenos Aires.vAleAnTNot to be outdone by big pharma, generic companies also wereinvolved in significant deal-making, with Valeant, a brandedgenerics and specialty pharmaceutical company based inCalifornia, standing out. The company, which agreed to mergewith Biovail of Canada in June, completed its acquisition of NewJersey’s Aton Pharma in May, and announced an agreementto acquire a Canadian OTC company called Vital Science Corpin April. Also in April, Valeant announced an agreement toacquire yet another privately held branded generics companyin Brazil. Within the last 12 months, Valeant has acquiredBunker Industria Farmacêutica Ltda and Instituto TerapêuticoDelta Ltda in Brazil, along with Tecnofarma SA de CV andLaboratorios Grossman SA in Mexico.OTHerOther major deals by generic companies in the second quarterincluded the definitive agreement for Sandoz to acquire OrielTherapeutics, a privately-held US specialty pharmaceuticalcompany focused on respiratory care. This acquisition will giveSandoz exclusive rights to a portfolio of generic candidates,three development projects, Oriel’s FreePath drug deliverysystem, and Solis multi-dose dry powder inhaler, which usesthe FreePath technology. It has been reported that FreePathhas the potential to address some of the hurdles facingregulatory approval of generic inhaled medicines in the USIn May, Endo announced an agreement to acquireHealthTronics, a leading US provider of urological productsand services. The deal is part of Endo’s strategy to diversify andexpand its offerings of urology products.Orchid, an Indian generic company, is trying to buy Karalex, asales and marketing operation in the US The company needs anincreased US-based sales capability in order to take advantageof its pipeline, which includes patent challenge products thatOrchid is believed to have been the first to file for, and is thusentitled to exclusivity. Karelex was founded in 2007 by twoformer executives of Par Pharmaceutical. PHARMA MATTERS | MOVERS AND SHAKERS
  10. 10. SeCTiOn v: Opening mOveS Based on our research of ANDA filings and Paragraph IV challenges, we highlight some of the companies making significant game play in the US generics industry. ipCA lAbOrATOrieS lTD. Ipca is a fully integrated pharmaceutical company based in Mumbai, India, making both finished dose products and active pharmaceutical ingredients for many international markets. Ipca’s active pharmaceutical ingredients (API) manufacturing facility at Ratlam has been inspected by the US FDA on a number of occasions. The company sells numerous APIs from that facility to the US market. Its dose facility has also been inspected by the US FDA. Ipca, which holds 10 active ANDAs, has so far launched most of its products to the US market through alliances. In 2006, Ipca entered into a strategic alliance with Ranbaxy Pharmaceuticals Inc. (now part of Daiichi). Under this alliance, the products were going to be marketed by Ranbaxy. Initially the dose products were going to be manufactured by Ranbaxy using Ipca’s active ingredients. Subsequently, both the API and finished dose were going to be manufactured by Ipca. The alliance covered a number of products, including atenolol, furosemide, hydrochlorothiazide, hydroxychloroquine sulfate, metformin HCl, and metoclopramide. The ANDA for metformin has since been discontinued. In 2007, Ipca entered into another strategic alliance focused on the US market, this time with Heritage Pharmaceuticals of New Jersey. Under the terms of the agreement, Ipca was going to develop, register, and manufacture the products, including propranolol, and Heritage would sell and market them in the US inTellipHArmACeuTiCS inTernATiOnAl inC. Intellipharmaceutics of Toronto, Canada, specializes in the research, development, and manufacture of both novel and generic controlled-release and targeted-release oral solid dosage drugs. The company is currently involved in a number of patent challenges in the US One of the challenges was in partnership with Par Pharmaceutical for a generic version of the Attention Deficit Hyperactivity Disorder (ADHD) drug Focalin XR® (dexmethylphenidate hydrochloride). In May 2010, the parties stipulated to the dismissal of the litigation. Intellipharmaceutics’ management expects that marketing of its generic version of Focalin XR would commence no sooner than Q4 2012.PHARMA MATTERS | MOVERS AND SHAKERS
  11. 11. Intellipharmaceutics’ partnership with Par Pharmaceuticalgoes back several years. In November 2005, the two companiesannounced an agreement for the US market to co-developcontrolled release formulations of generic drug products. InAugust 2007, Par Pharmaceutical purchased a 4.2 percentequity interest in Intellipharmaceutics and the two companiesentered into another agreement regarding the developmentand launch of controlled release generic drug products,bringing the total number of drugs under development to six.In May 2010, Intellipharmaceutics announced that the US FDAhad accepted its filing for an ANDA for a generic version of theantidepressant Effexor XR® (venlafaxine hydrochloride). OnJune 14, 2010, the company announced it had filed an ANDAfor a generic version of Protonix® (delayed release pantoprazolesodium). The company has since then been sued by WyethLLC, a wholly owned subsidiary of Pfizer Inc., regardingits venlafaxine application. The company also has genericcarvedilol and seven undisclosed products in its pipeline. PHARMA MATTERS | MOVERS AND SHAKERS
  14. 14. Image CopyrIght: reuTerS/David grayNeWport US marKet Share moDULeDeeper INSIght INto the WorLD’S LargeStpharmaCeUtICaL marKet OUR LATEST OPTIONAL CONTENT MODULES, NEWPORT MARKET SHARE We have launched the Newport US Market Share Module which covers 10 years of product market share history that can be analyzed by dose form, strength, marketer, and brand vs. generic, providing additional insight into the US market. This module integrates seamlessly with Newport Premium and Newport Global base systems. For more than 2,000 products, current information concerning the most frequent diagnosis and co-prescribed drugs, plus demographics including total population, male/female ratio, number of days supplied, and average annual payments are available. Current market share data for each product can be viewed by the number of dispensed units or prescriptions and as percentages or base figures by dose form, strength, marketer, and generic vs. brand split. History is available for 10 years and may be compared with up to five drugs competing in the same diagnosis code. HOW TO SUBSCRIBE The Newport US Market Share Module is an optional subscription module that may be added to your Newport Premium or Newport Global subscription for an additional annual charge. For more information, contact your account manager or visit©2010 Thomson Reuters. All rights reserved. Thomson Reuters and theKinesis logo are trademarks of Thomson Reuters.
  15. 15. To sign up to our Pharma Matters range of publications visit: THE ONES TO WATCH Focuses on the latest phase changes in the pharmaceutical pipeline. MOVERS AND SHAKERS Unravels the most significant game-play in the US generics market. THE CUTTING EDGE OF CHEMISTRY Insights into the chemistry advances transforming drug discovery and development. ABOUT NEWPORT PREMIUM Newport Premium is the critical product targeting and global business development system from Thomson Reuters, the industry authority on the global generics market. Created specifically for generic pharmaceutical companies and strategic API manufacturers, it can help you to identify and evaluate product opportunities worldwide, ensuring you’ll be first to find the generic product and niche opportunity, first to make the deal, and first to get to market. ABOUT THOMSON REUTERS Thomson Reuters is the leading source of intelligent information for professionals around the world. Our customers are knowledge workers in key sectors of the global economy. We supply them with the intelligent information they need to succeed in fields that are vital to developed and emerging economies such as law, financial services, tax and accounting, healthcare, science and media. Our knowledge and information is essential for drug companies to discover new drugs and get them to market faster, for researchers to find relevant papers and know what’s newly published in their subject, and for businesses to optimize their intellectual property and find competitive intelligence. NOTE TO PRESS: To request further information or permission to reproduce content from this report, please contact: Paul Sandell Phone: + 44 (0)20 7433 4704 Email: For more information on Thomson Reuters API Intelligence solutions, including Newport Premium, please visit or email scientific.lifesciences@thomsonreuters.comheaLthCare & SCIeNCeregIoNaL offICeSNorth Americaphiladelphia +1 800 336 4474 +1 215 386 0100Latin Americabrazil +55 11 8370 9845Other countries +1 215 823 5674Europe, Middle East and Africalondon +44 20 7433 4000Asia PacificSingapore +65 6775 5088Tokyo +81 3 5218 6500for a complete office list © 2010 Thomson reuters