News Column

RBC: Teva overoptimistic on large dosage Copaxone

February 18, 2014

By Shiri Habib-Valdhorn, Globes, Tel Aviv, Israel

Feb. 18--"Our survey results numerically suggest Teva Pharmaceutical Industries Ltd.'s (NYSE: TEVA; TASE: TEVA) targets are going to be hard to hit," says Royal Bank of Canada analyst Randall Stanicky about the company's three-times-a-week Copaxone. He reiterates his "Market perform" recommendation and target price of $39, 11% below Friday's closing price of $44.19 on the New York Stock Exchange.

"Teva is targeting to have 40,000 patients on the three-times-a-week by year-end (reflects 47% of current patients) including 30,000 by end of May. The physicians we polled had direct dialogue with 14% of patients, on average, at this point regarding a potential switch and expect an average of 31% of their patients to move to the three-times-a-week," says Stanicky. The variance was very wide, from 0-70%. "Asked whether they would hold off moving patients in anticipation of a generic being made available in late May, 50% said they would," he adds.

Three months before Copaxone's US patents expire, the company is trying to switch patients to the larger dosage, three-time-a-week injection, from the daily injection, in an effort to reduce the damage from possible generic competition for the multiple sclerosis treatment. In January, the US Food and Drug Administration (FDA) approved three-time-a-week Copaxone.

RBC carried out two separate surveys of over 50 neurologists in the US, two weeks after Teva launched its new version of Copaxone. UBS reported that, in the first week following the launch, 1.5% of new prescriptions for multiple sclerosis in the US were for the new version of Copaxone.

"We think the bigger concern should be how many patients who move to the three-time-a-week Copaxone would move back to a lower priced generic daily formulation. This is a risk that we think will get more attention and will leave some lingering uncertainty even in the event of a solid switch into generic approval. In our survey, physicians expected an average of 29% of patients who do ultimately switch to the branded three-time-a-week to switch back to a generic daily if one becomes available," says Stanicky. "This is a significant point, as many have assumed once a patient is on the 40mg, that patient will be sticky. We don't think this is the case and, in fact, think the number of patients who actually switch back could be much higher depending on how aggressive payors are."


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Source: Globes (Tel Aviv)

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