Shares of Teva Pharmaceutical Industries Limited (TEVA - Free Report) rose 4.5% on Tuesday after it announced the launch of a generic version of Mylan’s (MYL - Free Report) popular EpiPen Jr (epinephrine) auto-injector (0.15 mg) for severe allergy treatment.
Generic versions of EpiPen Jr for young children along with EpiPen for adults in 0.3 mg and 0.15 mg strengths were approved by the FDA in August to treat life-threatening allergic reactions like anaphylaxis. Teva had launched the generic version of EpiPen auto-injector 0.3 mg for adults in November last year.
Teva has priced generic EpiPen Jr at $300 for a pack of two, same as the adult version as well as Mylan’s authorized generic version of its own branded product.
Teva’s shares have declined 54.6% this year so far compared with the industry’s decrease of 9.5%.
Teva has a license, development and supply agreement with Antares Pharma per which the latter is responsible for the supply of EpiPen, which Teva will commercialize and distribute..
The approval of this drug-device combination product is part of FDA’s efforts to improve access to cheaper copycat versions of complex yet critically important medicines/products like EpiPen.
Mylan ran into massive trouble in 2016 for raising the price of EpiPen by more than 400% since its acquisition in 2007, drawing immense flak from lawmakers, consumers and common people alike. As a result of the increased prices of EpiPen, Mylan launched the first authorized generic for EpiPen in December 2016, which cost almost half of the branded version. Mylan is facing some supply shortages for EpiPen. Its manufacturing partner, Pfizer (PFE - Free Report) continues to experience interruptions in the production of EpiPen. Hence, Pfizer’s supplies to Mylan are inconsistent and inadequate in meeting global demand, including the United States. This leaves a significant market opportunity for Teva to capture.
Meanwhile, cheaper FDA approved branded alternatives to EpiPen, Auvi-Q and Adrenaclick, are also available in the market. Also, Adamis Pharmaceuticals and partner Sandoz, Novartis’ (NVS - Free Report) generic arm, gained FDA approval for a competing low cost pre-filled epinephrine syringe called Symjepi in June 2017. Sandoz launched it in 0.3 mg and 0.15 mg doses for both adult and pediatric patients in January this year.
However, Teva’s product is the first true generic rival of EpiPen to be approved by the FDA. Though Teva initially faced some supply issues for generic EpiPen, it is confident about a pickup in sales.
Teva 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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