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Analyst Blog

Teva Pharmaceutical Industries Ltd. recently announced that its supplemental new drug application (sNDA) for its thrice-weekly dosing regimen of Copaxone has been accepted for review by the US Food and Drug Administration (FDA).

The 40 mg thrice-weekly (3TW – three times a week) formulation of Copaxone represents a less frequent dosing regimen compared to the currently available once-daily 20 mg dosing regimen.

Copaxone is approved for the reduction of the frequency of relapses in relapsing-remitting multiple sclerosis (RRMS), including patients who have experienced a first clinical episode and have MRI features consistent with multiple sclerosis. Copaxone is the key branded product at Teva. With sales of almost $4 billion in 2012, Copaxone accounted for about 19.7% of total revenues.

Teva has been working on extending Copaxone’s lifecycle. Label expansion would help drive Copaxone sales and could reduce the impact of generic competition once Copaxone 20 mg loses exclusivity. A response regarding the sNDA will most likely be out early next year.

Apart from Teva, the multiple sclerosis market has several players like Biogen , Novartis and Pfizer among others. We expect Copaxone to face additional competitive pressure given the entry of new players in the multiple sclerosis market, especially Biogen’s oral multiple sclerosis treatment, Tecfidera.

Teva currently carries a Zacks Rank #3 (Hold). Teva is currently going through a tough transition period given fewer large generic opportunities, potential new competition for branded products (especially Copaxone) and a higher cost base.

However, we are encouraged by the company’s plans to improve its position. Teva said that it intends to accelerate growth platforms, protect and expand core franchises, expand its global presence, pursue strategic deals and reduce the cost base. We expect investor focus to remain on the execution of the company’s new strategy.

While Novartis and Pfizer are also Zacks Rank #3 stocks, Biogen is a Zacks Rank #2 (Buy) stock.

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