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Generic Lipitor: MYL’s motion for expedited hearing granted
Expedited Lipitor case should add visibility before June 28
Late Friday, the District Court for the District of Columbia granted Mylan’s
amended motion for an expedited hearing in its Lipitor lawsuit against the
FDA with several procedural dates for early April. While the likelihood of
success is still unclear, the case will keep generic Lipitor in focus over the
near-term with a June 28 launch date (expiration of pediatric exclusivity) a
real possibility should FDA be pushed to decide on Ranbaxy’s exclusivity
by then. While our base case expectations are detailed in our March 18
report “Generic Lipitor – launch looming, dynamics far from clear with
global stock implications”, the launch path remains fluid.
Near-term timelines to focus on in early April
We have reviewed the briefing schedule with early April set to bring
several updates. Specifically, (1) the FDA’s opposition to Mylan’s
Preliminary Injunction (PI) is due April 4 (2) Mylan’s reply in support of the
PI due April 11 (3) FDA’s reply in support of Motion to dismiss due April 15
and (4) Hearing on Motions to be scheduled for shortly thereafter. Mylan’s
suit is aimed at bringing an earlier generic launch and visibility around
timing to assist in launch preparations. The current November 30 date that
most anticipate, is arbitrary. Should Ranbaxy’s exclusivity be lost and
deemed to be subject to the AIP - Application Integrity Policy – we would
expect generic launches to occur on June 28. Specifically, we would
anticipate Mylan, Watson and Teva to launch – though with Teva it is worth
noting that it is not confirmed whether the product will be coming from its
Jerusalem facility which is currently under warning letter with restrictions
on new launches pending resolution.
“Scenario 3” – still most upside for MYL, TEVA, drug wholesalers,
downside for RBXY, PFE
Under our scenario 3, the economics would be consistent with our prior March
21 update. However, the lack of tentative approvals and outstanding warning
letters create further challenges to visibility. Should we assume a two player
launch with MYL and WPI earlier (June 28), we estimate a potential EPS boost
of 38% and 3% (cash benefit post Arrow payment), respectively. Under a three
generic launch (including TEVA) we estimate a 9% potential boost to MYL and
2% to TEVA, given its much larger base. We would expect the wholesalers to
benefit under a two or three player market with longer tail a positive. Earlier
entry would also have modest 2011 EPS benefit for PBMs.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Generic Lipitor: MYL’s motion for expedited hearing granted
Expedited Lipitor case should add visibility before June 28
Late Friday, the District Court for the District of Columbia granted Mylan’s
amended motion for an expedited hearing in its Lipitor lawsuit against the
FDA with several procedural dates for early April. While the likelihood of
success is still unclear, the case will keep generic Lipitor in focus over the
near-term with a June 28 launch date (expiration of pediatric exclusivity) a
real possibility should FDA be pushed to decide on Ranbaxy’s exclusivity
by then. While our base case expectations are detailed in our March 18
report “Generic Lipitor – launch looming, dynamics far from clear with
global stock implications”, the launch path remains fluid.
Near-term timelines to focus on in early April
We have reviewed the briefing schedule with early April set to bring
several updates. Specifically, (1) the FDA’s opposition to Mylan’s
Preliminary Injunction (PI) is due April 4 (2) Mylan’s reply in support of the
PI due April 11 (3) FDA’s reply in support of Motion to dismiss due April 15
and (4) Hearing on Motions to be scheduled for shortly thereafter. Mylan’s
suit is aimed at bringing an earlier generic launch and visibility around
timing to assist in launch preparations. The current November 30 date that
most anticipate, is arbitrary. Should Ranbaxy’s exclusivity be lost and
deemed to be subject to the AIP - Application Integrity Policy – we would
expect generic launches to occur on June 28. Specifically, we would
anticipate Mylan, Watson and Teva to launch – though with Teva it is worth
noting that it is not confirmed whether the product will be coming from its
Jerusalem facility which is currently under warning letter with restrictions
on new launches pending resolution.
“Scenario 3” – still most upside for MYL, TEVA, drug wholesalers,
downside for RBXY, PFE
Under our scenario 3, the economics would be consistent with our prior March
21 update. However, the lack of tentative approvals and outstanding warning
letters create further challenges to visibility. Should we assume a two player
launch with MYL and WPI earlier (June 28), we estimate a potential EPS boost
of 38% and 3% (cash benefit post Arrow payment), respectively. Under a three
generic launch (including TEVA) we estimate a 9% potential boost to MYL and
2% to TEVA, given its much larger base. We would expect the wholesalers to
benefit under a two or three player market with longer tail a positive. Earlier
entry would also have modest 2011 EPS benefit for PBMs.
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