August 2, 2013 | By Márcio Barra
Teva Pharmaceutical Industries profits fell in the second quarter, due to a decline in U.S. and European Generic sales, accprding to the numbers released today by Teva. But the real issue is the company’s over reliance on the multiple sclerosis drug Copaxone, soon to go without patent, casts a bleak outlook over the company.
Teva earned $1.20 per share excluding one-time items in the second quarter, compared with $1.28 a year earlier and analysts’ forecasts of $1.20 a share. Revenue dropped by 1%to $4.92 billion versus a forecast $4.94 billion. The $452 million net loss for the second quarter was also helped by the $1.4 billion patent settlement for Teva’s and Sun Pharma patent infringement over Pfizer’s drug Protonix, an acid reflux medication. Under the settlement, Takeda, Pfizer’s partner in marketing the drug, will receive 36%, about $774 million from the settlement, with the remaining 64% going to Pfizer. Teva will pay $1.6 billion, half this year and the rest by October 2014. Indian generics maker Sun Pharma will pay $550 million in damages in 2013.
Exchange rate fluctuations elsewhere, primarily in Japan, had a negative impact of $55 million on sales.
Copaxone alone accounts for 20% of the company’s sales, and 50% of Teva’s profit. The second quarter results of the multiple sclerosis drug were good, with global sales of the drug growing 9% to $1.1 billion, including a rise of 17 % to $817 million in the United States. The main snag is that Copaxone’s patent is set to end in 2014, with generics due to appear from Mylan Inc. and Momenta Pharmaceuticals Inc. starting May 25, 2014.
This comes a year earlier than expected, as the U.S. Court of Appeals for the Federal Circuit overturned a total of five patents on the drug last week. The company is also facing competition from other oral MS drugs, notably Biogen Idec’s Tecfidera (dimethyl fumarate), which are easier to administrate versus an injectable. Teva is hoping that its three-times-a-week formulation of Copaxone will be approved by the US Food and Drug Administration early next year.