Teva full-year profits up 22%
JERUSALEM Teva Pharmaceutical Industries got a big boost in profits in 2009 compared with 2008, the world’s largest generic drug maker announced.
Teva had profits of $3 billion for the year and earnings per share of $3.37, a 22% and 11% increase over 2008, respectively. Sales for the year were $13.9 billion, a 25% increase over 2008.
For fourth quarter 2009, profits were $847 million, 28% more than in fourth quarter 2008, while sales were $3.8 billion, 33% more than in 2008.
Among individual products, the company said it had global sales of $2.8 billion for the branded injectable multiple sclerosis drug Copaxone (glatiramer acetate).
“2009 was a very good year for Teva, a year in which our company delivered record-breaking sales and profits across all our geographies and major businesses,” Teva president and CEO Shlomo Yanai said in a statement. “This was also a year of major strategic achievements, including the successful integration of Barr, a process which was completed less than a year after closing, and from which we expect to continue to derive significant synergies for many years to come.”
In other news, the company said that Eli Hurvitz, chairman of its board of directors, would take a medical leave of absence for three weeks after responding successfully to a therapy for an unspecified recently diagnosed illness. Board member Moshe Many will serve as chairman while Hurvitz is away.
FTC pushes to end patent settlements, vexing branded, generic drug industry
NEW YORK On a lot of issues, the branded and generic drug industries agree about as readily as bacteria and antibiotics, but they have united on one issue: patent settlements.
Patent settlements between brand and generic drug companies, particularly those that involve brand companies paying generics companies, have come under fire lately from the Federal Trade Commission, which released a report last month similar to one released in June 2009 that asserted such deals prevent the timely entry of generic drugs onto the market and recommended that Congress move to ban them. Bills were introduced in both houses of Congress last year to ban what the FTC has called “pay-for-delay” deals, though neither succeeded.
“The problem with these sweetheart deals is clear,” FTC chairman Jon Leibowitz said in a Jan. 13 press conference to mark the report’s release. “Branded pharmaceutical companies are literally paying their generic competitors to stay off the market. Does it seem right that a company can make money by not selling its product? Of course not.”
Patent settlements are permitted under the Hatch-Waxman Act of 1984. A generic company that wishes to market its version of a branded drug before the patent expires will file for regulatory approval with the Food and Drug Administration with a paragraph-IV certification, which asserts that the drug’s patent is invalid, unenforceable or won’t be infringed. This usually prompts a patent litigation suit from the branded drug maker, which bars the generic company from marketing its drug for 30 months or until it wins the suit or reaches a settlement with the brand company.
For the FTC, settlements become a problem when they involve the brand company paying the generic company not to immediately launch its product, with payment including anything from monetary compensation to the promise not to market an authorized generic during the generic company’s customary six months’ market exclusivity after the patent expires. According to the commission’s report, generic launch occurs, on average, 17 months later when settlements involve payment than when they do not, costing consumers $3.5 billion a year.
But the Generic Pharmaceutical Association, the Pharmaceutical Research and Manufacturers of America, and some analysts have criticized the report. For starters, an agreement to delay generic launch after the expiration of a patent would be illegal, GPhA president and CEO Kathleen Jaeger told Drug Store News, and she disputed the validity of the phrase “pay-for-delay.” Not only that, Jaeger said, but settlements often bring generic drugs to market earlier than when no settlement occurs, before the expiration of the patent. According to an analysis by RBC Capital Markets, generic companies have prevailed in 48% of patent litigation cases that have gone to trial overall over the last decade, but that figure increases to 76% when settlements are included; more than half of all cases are settled or dropped.
“They’ve couched it in a cute little phrase here, but it’s really misleading, and it’s wrong,” Jaeger told Drug Store News. “The vast majority of settlements are bringing in products so many years earlier.”
Soon after the FTC released its report, investment-banking firm Jefferies hit back with a strongly worded analysis challenging the FTC’s conclusions and methodology. Among other problems Jefferies said it found, the report didn’t consider the savings generated by generic entry before patent expiration and “falsely” assumed that patent settlements would continue to happen if payments were banned. It also, Jeffries said, didn’t take into account such variables as payment magnitude or the time of patent expiration. According to the Jefferies report, a ban on payments in settlements would make settlements generally less likely to occur.
“The end result is that our companies are not going to invest in the patent settlements that they do today,” Jaeger said.
At least until the Ides of March, Walgreens agrees to fill Washington Medicaid scripts
DEERFIELD, Ill. Walgreens has announced that it will continue to fill Medicaid prescriptions at its Washington state pharmacies until March 15. The company previously announced that it would stop filling Medicaid prescriptions in 64 of its 121 pharmacies due to a continued reduction in reimbursement under the State of Washington Medicaid program. The company made the decision to delay the withdrawal of the program as talks continue between the company and state. Secretary of the Washington State Department of Social and Health Services, Susan Drayfus, has stated that the state is grateful for Walgreens’ delay.