Shares of US generic drugmaker Mylan Laboratories jumped 5.3% to $20.40 on October 4, overshooting the firm’s 52-week high on the news that final clearance from the US Food and Drug Administration to sell a copycat version of drug giant Pfizer's blood pressure agent Norvasc (amlodipine besylate) has been granted.
Marketing a generic version of Norvasc could prove to be a highly lucrative move for Mylan, as Pfizer’s drug notched up sales of some $4.4 billion in 2004. If all goes well, the 180-day exclusivity period due to Mylan could be worth around $0.28 a share to the group, according to Wachovia Securities analyst Michael Tong.
However, the timing of market entry for Mylan’s generic is still somewhat unclear. The companies are embroiled in an ongoing patent infringement battle over Norvasc, which loses patent protection in early 2007. The 180-day exclusivity period will start from either Mylan’s launch of its drug or on a final court decision regarding its lawsuit with Pfizer, the company said.
Generic erosion of sales signifies a looming problem for Pfizer, as many of its top-selling drugs are due to lose patent protection in the next few years, including the antifungal agent Diflucan (fluconazole), the epilepsy drug Neurontin (gabapentin) and the antidepressant Xoloft (sertraline). Chief executive Hank McKinnell has acknowledged the likely dent in revenues that will occur as a result, commenting: "We have long understood that we are facing significant patent expirations in the 2005-7 period that will impact $14 billion of Pfizer revenue," but he also stressed the company is "in a much different situation than those that failed to anticipate or lacked the means to respond to these challenges." [[01/12/04a]]