Momenta filed the abbreviated new drug application for Copaxone 20 mg in December 2007, while Natco filed it in October 2009. Both the companies will get exclusive marketing rights for 180 days to sell the drug in the US. Photo: Reuters
Momenta filed the abbreviated new drug application for Copaxone 20 mg in December 2007, while Natco filed it in October 2009. Both the companies will get exclusive marketing rights for 180 days to sell the drug in the US. Photo: Reuters

Natco shares surge 5.6% after US court rejects Teva’s copaxone patent

In intra-day trade, the stock gained 7.9% to Rs2,240 after a US court in a 2-1 decision invalidated a patent held by Teva Pharma after 7 years of litigation

Mumbai: Shares of Natco Pharma Ltd surged on Friday on BSE on reports that US-based Momenta Pharmaceuticals Inc. has won a favourable verdict in a US court to launch a cheaper generic version of Israel-based Teva Pharmaceutical’s multiple sclerosis drug Copaxone 20 mg in the US market.

In intra-day trade, the stock gained 7.9% to 2,240.

Multiple sclerosis is a chronic degenerative disease of the central nervous system.

Momenta partnered with Switzerland-based Novartis AG’s generic subsidiary Sandoz Inc., and Natco tied up with US-based Mylan NV to challenge Teva’s Copaxone 20 mg patent.

The US court of appeals for the Federal Circuit, the nation’s top patent tribunal, in a 2-1 decision invalidated a patent held by Teva after seven years of litigation.

It is the second time that the US court of appeals has reviewed Teva’s patent. In January, the US supreme court referred back the case relating to Teva’s US patent to the US court of appeals to review its validity.

The US Food and Drug Administration (USFDA) approved the abbreviated new drug application (ANDA) filed by Momenta-Sandoz for generic Copaxone in April.

The appeals court’s decision will help Natco and Mylan to launch the drug much before September 2015, subject to USFDA approval. Patents of Teva’s Copaxone 20 mg version are set to expire in September 2015.

Momenta filed the abbreviated new drug application (ANDA) for Copaxone 20 mg in December 2007, while Natco filed it in October 2009. Both the companies will get exclusive marketing rights for 180 days to sell the drug in the US.

“We believe that the news is also positive for Natco which can now launch the drug before September 2015 if it receives the final USFDA nod in the coming months," said Hitesh Mahida, research analyst at Antique Stock Broking Ltd.

“We have currently built in conservative $21 million PAT (profit after tax) from Copaxone 20mg for Natco. Expect an EPS (earnings per share) of 36 from Copaxone 20mg for Natco in FY17," Mahida said.

Momenta did not disclose the launch date or pricing.

Momenta has indicated that it is eligible to receive up to $120 million in milestone payments upon the achievement of certain US commercial and sales-based milestones from Copaxone, indicating that profit from the drug could be significantly high.

The average cost of Copaxone injectable treatment in US is close to $65,000 a year per patient, the generic launch could reduce cost of multiple sclerosis treatment significantly.

To minimise the impact of generic knockoffs, Teva has been trying to migrate patients to the higher-dose version or 40 mg which is covered by patents that don’t expire until 2030.

Shares of Natco Pharma closed 5.58% higher at 2,192.30 apiece on BSE, while the benchmark Sensex rose 0.74%, or 200.34 points, to 27,316.17.

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