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Should You Hold Momenta (MNTA) Stock in Your Portfolio?
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Cambridge, MA-based Momenta Pharmaceuticals, Inc. is currently facing challenging business conditions.
It operates in three areas — Complex Generics, Biosimilars and Novel Therapeutics.
The company markets Glatopa, a generic version of Teva’s (TEVA - Free Report) multiple sclerosis (MS) drug Copaxone (20 mg), in collaboration with Novartis’ (NVS - Free Report) Sandoz. Glatopa is the first substitutable generic drug approved for the treatment of relapsing forms of multiple sclerosis (RRMS). Offering major relief to investors, the FDA finally approved Sandoz's Abbreviated New Drug Application for Glatopa 40 mg in February 2018, after initial setbacks.
However, Mylan won the FDA’s approval for a generic version of Teva Pharmaceuticals Copaxone 40 mg earlier than Momenta. Notably, this is the first generic of Copaxone that has been approved. Since Mylan was one of the first applicants to submit a substantially complete ANDA for glatiramer acetate Injection, 40 mg/mL, containing a Paragraph IV certification, the company already has an upper hand in the market which shall make it difficult for Momenta to gain market share.
While Sandoz is still in the early phases of the launch, Mylan launched its generic equivalents of once-daily Copaxone 20 mg/mL and three-times-weekly Copaxone 40 mg/mL in October 2017. As a result, the market and contractual profit share revenue of Glatopa 20 mg/mL has been reduced by an accelerated conversion of patients from once-daily 20 mg/mL glatiramer acetate injection to three-times-weekly 40 mg/mL glatiramer acetate injection due to lower pricing in that market. At the end of 2017, Teva’s three-times-weekly Copaxone 40 mg/mL and Mylan N.V.’s three-times-weekly generic equivalent product accounted for approximately 82% of the overall U.S. glatiramer acetate injection market (20 mg/mL and 40 mg/mL) based on volume prescribed.
While the progress with the biosimilars pipeline has been encouraging, Momenta suffered another setback when the company and partner Mylan announced that M834, a proposed biosimilar for Orencia, did not meet its primary pharmacokinetic end points in a phase I study to compare the pharmacokinetics, safety and immunogenicity of M834 to Orencia in normal healthy volunteers.
The Biologics License Application (“BLA”) for Momenta’s M923, a biosimilar version of Humira, is also ready to be filed with the FDA. However, the filing of the BLA is dependent on the outcome of the company’s ongoing strategic review.
We note that given the recent setbacks, Momenta initiated a strategic review of its ongoing operations with the goal of reducing expenditure on its biosimilar portfolio, which should free up additional capital to fully fund its novel autoimmune portfolio. The company does not have the runway to develop the broad portfolio it created barring the revenue stream from Glatopa, without excessive dilution for its investors. Hence, Momenta is exploring a few options and expects to complete this strategic review by the end of the second quarter of 2018.
Momenta Pharmaceuticals, Inc. Price, Consensus and EPS Surprise
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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Should You Hold Momenta (MNTA) Stock in Your Portfolio?
Cambridge, MA-based Momenta Pharmaceuticals, Inc. is currently facing challenging business conditions.
It operates in three areas — Complex Generics, Biosimilars and Novel Therapeutics.
The company markets Glatopa, a generic version of Teva’s (TEVA - Free Report) multiple sclerosis (MS) drug Copaxone (20 mg), in collaboration with Novartis’ (NVS - Free Report) Sandoz. Glatopa is the first substitutable generic drug approved for the treatment of relapsing forms of multiple sclerosis (RRMS). Offering major relief to investors, the FDA finally approved Sandoz's Abbreviated New Drug Application for Glatopa 40 mg in February 2018, after initial setbacks.
However, Mylan won the FDA’s approval for a generic version of Teva Pharmaceuticals Copaxone 40 mg earlier than Momenta. Notably, this is the first generic of Copaxone that has been approved. Since Mylan was one of the first applicants to submit a substantially complete ANDA for glatiramer acetate Injection, 40 mg/mL, containing a Paragraph IV certification, the company already has an upper hand in the market which shall make it difficult for Momenta to gain market share.
While Sandoz is still in the early phases of the launch, Mylan launched its generic equivalents of once-daily Copaxone 20 mg/mL and three-times-weekly Copaxone 40 mg/mL in October 2017. As a result, the market and contractual profit share revenue of Glatopa 20 mg/mL has been reduced by an accelerated conversion of patients from once-daily 20 mg/mL glatiramer acetate injection to three-times-weekly 40 mg/mL glatiramer acetate injection due to lower pricing in that market. At the end of 2017, Teva’s three-times-weekly Copaxone 40 mg/mL and Mylan N.V.’s three-times-weekly generic equivalent product accounted for approximately 82% of the overall U.S. glatiramer acetate injection market (20 mg/mL and 40 mg/mL) based on volume prescribed.
While the progress with the biosimilars pipeline has been encouraging, Momenta suffered another setback when the company and partner Mylan announced that M834, a proposed biosimilar for Orencia, did not meet its primary pharmacokinetic end points in a phase I study to compare the pharmacokinetics, safety and immunogenicity of M834 to Orencia in normal healthy volunteers.
The Biologics License Application (“BLA”) for Momenta’s M923, a biosimilar version of Humira, is also ready to be filed with the FDA. However, the filing of the BLA is dependent on the outcome of the company’s ongoing strategic review.
We note that given the recent setbacks, Momenta initiated a strategic review of its ongoing operations with the goal of reducing expenditure on its biosimilar portfolio, which should free up additional capital to fully fund its novel autoimmune portfolio. The company does not have the runway to develop the broad portfolio it created barring the revenue stream from Glatopa, without excessive dilution for its investors. Hence, Momenta is exploring a few options and expects to complete this strategic review by the end of the second quarter of 2018.
Momenta Pharmaceuticals, Inc. Price, Consensus and EPS Surprise
Momenta Pharmaceuticals, Inc. Price, Consensus and EPS Surprise | Momenta Pharmaceuticals, Inc. Quote
Nevertheless, the autoimmune portfolio holds promises. Momenta’s stock has gained 72.1% in the past six months against the industry’s decline of 8.7%.
Zacks Rank
Momenta currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
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Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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