Copaxone sales likely to top out this year, Teva exec says

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Sales of Teva's multiple sclerosis blockbuster Copaxone are likely to peak this year before gradually giving way as more therapeutic options become available, a Teva exec says.

The head of global brands for the Israeli drugmaker, Jon Congleton, made the statement Wednesday during a meeting with Jefferies analysts. Copaxone, a daily injection, generated US sales of $2.95 billion last year, according to IMS Health, accounting for roughly a third of the MS market.

“Teva reiterated its view that 2012 will most likely represent the peak year for Copaxone sales, as it expects several new market entrants over the next several years,” the analysts wrote in a June 7 recap for investors.

How far are sales due to fall? The Jefferies analysts don't include a forecast, but analysts from Leerink Swann recently issued a $3.9 billion peak forecast for 2012, followed by $3.8 billion next year, $3.5 billion in 2014, $2.7 billion in 2015 and $2.4 billion in 2016.

The looming challenges to Copaxone, Teva's top seller, threaten to undermine its move into branded medicines. Teva, the world's largest generics firm, has been trying to broaden its portfolio beyond selling copy cat drugs. Last year former CEO Shlomo Yanai bought branded biotech firm Cephalon for $6.5 billion. New CEO Jeremy Levin, who replaced Yanai in May, is tasked with finding more new revenue streams to replace a coming Copaxone shortfall.

The drug faces intense competition from a host of other injection and infusion products—such as Biogen Idec's Avonex, Bayer's Betaseron and Pfizer's Rebif—as well as from orals. Novartis' pill Gilenya was approved in the US in March 2011 for replasing forms of the degenerative disease and went on to post US sales of $383 million for the full year. The US market may see the arrival of a second oral MS drug later this year, Biogen Idec's BG-12, which is now awaiting FDA approval.

Teva isn't ceding the market to these other players. The drugmaker “believes that Copaxone's well-established history of safety is underappreciated,” wrote the Jefferies analysts. “History has shown that whenever a new drug enters the market, there's almost never an immediate majority share shift. Even with much better efficacy, Novartis'…Gilenya is a good example, which has underperformed initial bullish expectations.”

Gilenya's greater efficacy compared to Copaxone and more convenient formulation could drive prescribing. But concerns over a small number of unexplained patient deaths have been an overhang on the launch. Initial uptake of BG-12 is also expected to be gradual, although that drug compares favorably to Copaxone, as well, and the Biogen Idec sales force, which already sells Avonex and Tysabri, is well known to neurologists.

Other factors weighing on the company's Copaxone outlook include a patent challenge that could result in generic competition prior to 2014, when the patents would otherwise expire. Arguments were heard late last year, and a court decision is expected in the next few months. Several analysts expect the drugmaker to prevail over the generics firms. 

That might not prevent biosimilars from eating into market share, though. While biosimilar policies are not likely to be in place for some time, their arrival promises to fragment the MS market even more. Teva also disclosed to the Jeferries analysts that this past Monday it filed its fourth Citizen's Petition with the FDA arguing its view of Copaxone biosimilars.

The drugmaker is not standing still. Teva is developing its own oral MS formulation, laquinimod, but it is far behind the other oral therapies. “Teva reminded us that ‘laquinimod is still alive, and there is hope,'” the analysts reported. The firm is in discussions with the FDA on the design of a third laquinimod trial expected to begin later this year, as well as exploring use of a higher dose than the one used in the previous Phase III trials and using a different primary endpoint in this third trial.

Teva is also testing a formulation of Copaxone designed to be taken three times a week. Data from this study are expected to be made public later this year, and assuming they are positive, Teva would file an sNDA in the second half, according to Jefferies. Only 20-30% of the once-daily market are expected to convert. It's also enrolling patients in a study of a lower volume Copaxone version designed to boost compliance.

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