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Pharma earnings from the West
Read-across for Indian generics
DRRD ties up with Teva for generic olanzapine – upside
seems protected
Watson comments suggest distributors are waiting for clarity
on Ranbaxy’s entry into generic Lipitor – positive for RBXY
Mylan is seeking entry into India formulations in the next year
Teva joins hands with Dr Reddy’s on Zyprexa
Teva (TEVA IT, CMP ILS15,580, N/R) reported at its Q2CY11 earnings call yesterday
that it has partnered with DRRD (Dr Reddy’s Labs, DRRD IN, CMP INR1,589, OW, TP
INR2,000) on generic Zyprexa 20mg-strength tablet. This would allow Teva to participate
in the entire Zyprexa market. We believe DRRD would have partnered with Teva to
protect its upside, while at the same time lessen the risk of lower market share.
Zyprexa is a blockbuster drug used in the indication of schizophrenia with annual sales of
over USD2.5bn, of which 20mg alone contributes c35% of the total. We incorporate
USD100mn of sales for DRRD from generic olanzapine (Zyprexa) in FY12 assuming
50% price erosion and 40% share. The profit contribution as per these assumptions is
c20% in FY12e reported EPS.
Eli Lilly earlier commented at its earnings call that there is a possible authorised generic
planned at the time of generic entry, which could increase competition in the market. We
believe the DRRD tie-up with Teva would protect DRRD’s upside in such a case.
Other key readings:
Teva bullish on US generics opportunity. “The opportunity to bring high quality,
affordable generics to patients in the U.S. has never been greater. There is over $0.25
trillion of U.S. branded opportunity awaiting generics.”
Early June, Teva received notification from the FDA that the corrective action taken
with respect to the Jerusalem oral solid dosage facility appeared to address the
concerns listed in the January warning letter. The FDA conducted a follow-up
inspection, which concluded with no observations.
Teva's pipeline includes 185 ANDAs, representing USD116bn of this branded value,
with 77 first-to-file opportunities worth USD54bn.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Pharma earnings from the West
Read-across for Indian generics
DRRD ties up with Teva for generic olanzapine – upside
seems protected
Watson comments suggest distributors are waiting for clarity
on Ranbaxy’s entry into generic Lipitor – positive for RBXY
Mylan is seeking entry into India formulations in the next year
Teva joins hands with Dr Reddy’s on Zyprexa
Teva (TEVA IT, CMP ILS15,580, N/R) reported at its Q2CY11 earnings call yesterday
that it has partnered with DRRD (Dr Reddy’s Labs, DRRD IN, CMP INR1,589, OW, TP
INR2,000) on generic Zyprexa 20mg-strength tablet. This would allow Teva to participate
in the entire Zyprexa market. We believe DRRD would have partnered with Teva to
protect its upside, while at the same time lessen the risk of lower market share.
Zyprexa is a blockbuster drug used in the indication of schizophrenia with annual sales of
over USD2.5bn, of which 20mg alone contributes c35% of the total. We incorporate
USD100mn of sales for DRRD from generic olanzapine (Zyprexa) in FY12 assuming
50% price erosion and 40% share. The profit contribution as per these assumptions is
c20% in FY12e reported EPS.
Eli Lilly earlier commented at its earnings call that there is a possible authorised generic
planned at the time of generic entry, which could increase competition in the market. We
believe the DRRD tie-up with Teva would protect DRRD’s upside in such a case.
Other key readings:
Teva bullish on US generics opportunity. “The opportunity to bring high quality,
affordable generics to patients in the U.S. has never been greater. There is over $0.25
trillion of U.S. branded opportunity awaiting generics.”
Early June, Teva received notification from the FDA that the corrective action taken
with respect to the Jerusalem oral solid dosage facility appeared to address the
concerns listed in the January warning letter. The FDA conducted a follow-up
inspection, which concluded with no observations.
Teva's pipeline includes 185 ANDAs, representing USD116bn of this branded value,
with 77 first-to-file opportunities worth USD54bn.
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