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Novartis & Amgen in Legal Dispute Over Migraine Drug Aimovig

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Swiss pharma giant Novartis AG (NVS - Free Report) announced it is suing partner Amgen (AMGN - Free Report) .

Both the companies had a development and worldwide commercialization agreement for migraine drug, Aimovig (erenumab).

Aimovig is designed specifically to block the calcitonin gene-related peptide receptor (CRGP). Per Novartis, Aimovig is the first FDA and EMA-approved CGRP-targeted therapy for the prevention of migraine in adults. The drug was approved in the United States in May and EU in July 2018. Both the companies co-commercialize the drug in the United States. While Amgen has exclusive rights to commercialize the drug in Japan, Novartis has exclusive commercialization rights in the rest of the world.

However, on Apr 2, 2019, Amgen issued a notice of termination for the migraine collaboration agreements with Novartis due to an alleged material breach of the same.

Consequently, Novartis has filed a lawsuit asking the court to confirm that Amgen has no right to terminate the agreements.

CRGP are a new class of drugs, which are designed to reduce the number of migraine attacks and have fewer adverse reactions in clinical trials, and lesser warnings and precautions compared to other approved migraine therapeutics. Other drugs in this category are Teva’s (TEVA - Free Report) Ajovy and Eli Lilly’s (LLY - Free Report) Emgality.

The uptake of the drug has been encouraging, and more than 165,000 patients worldwide have been treated with Aimovig since launch.

Shares of the company have gained 12.7% in the past six months compared with the industry's 2.7% growth.

 

Last year was a transformative one for Novartis, as it restructured its business to become a core drug-focused company, powered by data and digital technologies. The company acquired U.S.-based clinical-stage gene-therapy company, AveXis, Inc in 2018. Novartis also acquired Endocyte to expand expertise in radiopharmaceuticals. We expect more acquisitions in the coming months, as the company looks to further restructure its business.

Zacks Rank

Novartis currently carries a Zacks Rank #3 (Hold).  You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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