Gen 6-11-15 Pg. 1_Gen 18/11/05 Pg. 1 04/11/2015 17:37 Page 1

6November 2015

COMPANY NEWS 2 EU proposal will allow Concordia completes acquisition of AMCo 2 Walgreens’ Rite Aid bid worthUS$17bn 3 NewZealand’sAFT weighs initial listing 4 Perrigounveils plan to 5 production during SPC contest Mylan bid Reddy’ssees Russia as biosimilars target 6 Indian warning mars 7 “targeted supplementary protection certificate (SPC) waiverfor export purposes” Sandoz’ performance Awill allowEuropean Union (EU) manufacturers of generics and biosimilars to “compete Kabi “fullyontrack” forcost-cutting plan 8 on equal footing with competitors from non-EU countries”, under proposals that have Authorised launches aid Sanofi Generics 10 just been published by the European Commission. Aworking document entitled ‘A single IGI changes identity to 11 market strategy forEurope –analysis and evidence’ sets out the Commission’splans become Te ligent to implement “a recalibration of the patent and SPC regulatory framework in the EU”. Lupin upbeat that US approvals 12 Having long campaigned for a‘Bolar’ style manufacturing exemption during the SPC will return period, the European Generic and Biosimilarmedicines Association (EGA) welcomed the Commission’sstrategy proposals. “Europe needs to rapidly introduce atargeted SPC waiver MARKET NEWS 13 to capitalise on this tremendous opportunity for pharmaceutical manufacturing in the EU,” said EGA director general Adrian vanden Hoven. “The European generic and biosimilar France saves C1.7bn as 13 medicines industry is on the cusp of creating manymore jobs as it expands access to high substitution rises quality medicines for patients.” FTC slams FDAoverbiologicals 14 “Under the current system,”the EGA noted, “European manufacturersare required to suffix plans outsource production to supply countries without SPCs, or where SPCs expire earlier than in Swedish prescribing must aid substitution 15 Europe, and to stimulate competition as soon as SPCs expire in Europe.” Observing that “global spending is expected to shift toward generic medicines”,the Commission stated that generics and biosimilars“could represent 80% of the volume of medicines PRODUCT NEWS 16 by 2020”. “AnSPC manufacturing waiver for export purposes to non-EU countries with no Unipharm has remedy 16 SPC protection could allowthe EU generics and biosimilars industries both to create thousands over Sanofi’sPlavix of high-tech jobs in the EU and start manynew companies,”the Commission recognised. Glenmark teams up forEU 17 Moreover, the Commission also plans to introduce a“unitary SPC” to complement the Seretide rival unitary European patent system. This would “enhance the value, transparencyand legalcertainty Pfizer must respond on US Retacrit letter 18 of the protection of medicines”,providing a“one-stop shop for the granting of SPCs in Europe” and giving “enhanced certainty to European health authorities, to patients and to generics Te va defeats AZ in Dutch DuoResp duel 19 companies on the status of aregulated product’sintellectual-property protection”. G Celltrion has success 21 switching infliximab FEATURES 24 Mylan set to file Advair ANDA Sawai sets sights on US and 24 plans fordomestic demand ylan expects to file an abbreviated newdrug application(ANDA) in the US for a Japan’sSawai Pharmaceutical is filing Msubstitutable generic version of GlaxoSmithKline'sAdvair Diskus (fluticasone/salmeterol) products in the US as it scales up its blockbuster inhaler within the next fewweeks. The generics firm recently conducted a production capacitytosatisfy an “collaborative”pre-ANDAmeeting with the US Food and Drug Administration (FDA) and anticipated increase in domestic believesits formulation, “developed to be qualitatively and quantitatively the same” as the demand. Aidan Fry reports. reference brand, meets all the criteria for an AB-substitution rating that are laid out in the agency’sdraft guidance (Generics bulletin,20Sept 2013, page 1). REGULARS RajivMalik, Mylan’spresident, said the companywas currently completing the third of three pharmacokinetic (PK) studies to support the ANDAsubmission, having already finished Paragraph IV Watch – Xarelto 20 aclinical endpointstudy.Furthermore, human-factor and device-robustness studies had, he said, Events – Our regular listing 22 demonstrated that Mylan’sdry-powder inhaler could “be used as successfully with newpatients as those trained on Advair Diskus”. Price Watch UK – UK pricing trends 23 Malik said Mylan and its partner Prosonix were “making good progress” on developing a People – Lupin appoints heads 27 generic rivaltoFlovent (fluticasone) for the US, having completed pilot PK studies. Meanwhile, for twoofits regions an equivalent project for generic Flixotide in the European Union was“on track to be approved in the first quarter of 2016”, Malik noted. G Gen 6-11-15 Pgs. 2-12_Layout 1 04/11/2015 17:39 Page 2

COMPANY NEWS

MANUFACTURING MERGERS&ACQUISITIONS Krka facility boosts Concordia completes vertical integration acquisition of AMCo

rka says it expects to gain a“keystrategic advantage” by opening oncordia Healthcaresays it possesses “a powerful global platform Kamanufacturing facility for active pharmaceutical ingredients Cfor our continued organic growth” after completing its US$3.5 (APIs) in Krško, Slovenia. billion takeoverofUK-based Amdipharm Mercury (AMCo) from The Sinteza 1plant, into which the companyhas invested C85 vendors including Cinven(Generics bulletin,2October 2015, page 5). million (US$94 million), “givesKrka newcapacities for maintaining Mark Thompson, Concordia’sfounder,chairman and chief the entire process from development to production of rawmaterials executive officer,noted that the acquisition had “transformed us from and finished products”. apredominantly US business to aleading international pharmaceutical According to the Slovenian group, the 5,529 sq mplant will company” that generated around two-fifths of its turnoverinthe US. support its business model that already sees more than 70% of the firm’s Concordia insists it is “competitively positioned with AMCo’s portfolio vertically integrated from API through to finished doses. attractive,international portfolio that focuses on products with high “Krka’sown production of most of its keyAPIs enables the barrierstoentry,such as difficult manufacturing processes, technical companytoplan and manage the entire vertically-integrated business barriersand complexregulatory hurdles”. The vast majority of AMCo’s process, which results in high-quality, effective and safe APIs,”the top-20 products by value currently had twoorfewer competing drugs. companyclaimed. “This allows Krka to be the first to launch its With AMCo on board from 21 October this year,Concordia generic products to selected keymarkets and to have the necessary anticipates its 2016 full-year turnovertopping US$1 billion. Group speed and flexibility to react to regulatory and market changes, as sales of US$1.02-US$1.06 billion should generate adjusted earnings well as to better handle business risks.” before interest,tax, depreciation and amortisation (EBITDA) of Having acquired a16.6 hectare plot in Krško, north-east of its US$610-US$640 million. By the end of 2016, the firm anticipates Novo Mesto headquarters, Krka intends to build further raw-material having anet debt no more than 5.5-times its EBITDA. capacity at the site. Over the “next fewyears”, the companyalso intends “Management expects high single-digitrevenue growth of the to increase its annual finished-dose output from nearly 13 billion tablets combined business overthe next three years, drivenprimarily by and capsules to more than 17 billion. The group expects to make expected organic volume growth through continued promotion of its capital investments this year of around C165 million. G legacy products and up to 60 product launches,”Concordia stated. G

BARCELONA · BASILEA BUDAPEST · DUBAI MADRID · MONTEVIDEO SÃO PAULO · VALENCIA

ANYTHING International distribution:Collections and deliveries to any place,standard or urgent ANYWHERE service,refrigerated,own DGR transportation, oversized transportation,customs, freight ANYTIME forwarding… Local and national deliveries within 24 hours. We offer logistics and distribution services that satisfy the specific needs of the SPECIALISTS INTRANSPORTING PHARMA AND CHEMICALS pharmaceutical industry, as well as the www.airpharmlogistics.com chemical and veterinary.

2 GENERICS bulletin 6November 2015 Gen 6-11-15 Pgs. 2-12_Layout 1 04/11/2015 17:39 Page 3

COMPANY NEWS

BUSINESS STRATEGY/THIRD-QUARTER RESULTS MERGERS&ACQUISITIONS Teva stillsearching Walgreens’ Rite Aid for biosimilars deal bid worth US$17bn

eva is continuing to search for apartnership to strengthen its position algreens Boots Alliance (WBA) has agreed to acquire US Tin the biosimilars market, according to the head of the company’s Wdrugstore rivalRite Aid in atransaction valued at around US$17.2 Global Generic Medicines business segment, Siggi Olafsson. “Time billion, including acquired debt. The US$9.00 per share all-cash is ticking on us, butwereally will be aplayer in this space,”hesaid, deal –which has been approvedbyboth firms’ board of directors, Noting that the group currently generated annual sales of around butissubject to approvalbyRite Aid shareholders and antitrust US$350 million from its ‘waveone’ biosimilars and proprietary Granix clearances –isscheduled to close in the second half of next year.WBA (tbo-filgrastim) brand, Olafsson acknowledged that Teva had “walked said the deal represented a48% premium to Rite Aid’sshare price away” from ‘wavetwo’monoclonal antibody biosimilars when it broke ahead of the offer. offajoint venture with Lonza. The three biosimilars that remained in With group sales of US$26.5 billion in its financial year ended the firm’spipeline were “focused on wave three”, beyond the coming 28 February 2015, Rite Aid as of 24 October operated 4,561 stores cliffofmonoclonal expiries up to 2020, he explained. across the US. The US companynoted that it wasmoreover“the “Wehavealot to offer apartnership in terms of research and largest drugstore chain on the East Coast and the third-largest in the development,”Olafsson insisted, highlighting the commercial US”, employing “roughly 89,000 associates”. infrastructure offered by both Teva’s Generics and Specialty segments. Pointing out that it expected procurement savings would be “The question is, howdoyou select to come into this space? Do you among gross synergies “in excess of US$1 billion” –but giving no want to play in the wave twospace? Or should we focus on wave three?” timeframe for when this target wastobeachieved–WBAnoted that Turning to generic injectables,Olafsson said Teva was“slowly Rite Aid would, upon completion of the deal, become awholly-owned growing our share” following quality issues. The pending US$40.5 subsidiary that would initiallyoperate under its existing brand name. billion acquisition of Actavis Generics from Allerganwould strengthen “Working together,decisions will be made overtime regarding the Teva’s injectables presence considerably,hetold investors. integration of the twocompanies, ultimately creating afully- The Actavis deal was“fully sealed” and discussions with antitrust harmonised portfolio of stores and infrastructure,”WBA stated. authorities were progressing, he outlined, with more than 40 potential Questioned by investors about the antitrust clearance process, bidders for divested assets lined up. Integration planning wasalso WBA’svice-chairman and chief executive officer,Stefano Pessina, said underway,with leaders for keyfunctions already identified. “we are not speculating at all about the number of stores that we will The recently announced US$2.3 billion deal for Mexico’sRimsa have to divest”. WBAhad not taken anydecision about howtodeal would not only give Teva abrands, branded generics and OTC with Rite Aid’scurrent distribution contract with McKesson, rather presence for the country’s120 million inhabitants,itwould also give than with WBA’spartner AmerisourceBergen, he added. the group a“platform into the rest of Latin America”. “Wehavenot done this [deal] to increase our negotiating power Higher sales in Latin America and Russia outweighed declines with payers and pharmacybenefit managers,”Pessina insisted. “Wehave in Canada and Japan as Teva increased its local-currencyGenerics done this because we believe that we can extract alot of synergies.” sales in its Rest of the World region by atenth to US$509 million WBA’sRetail PharmacyUSA division covering the Walgreens in the third quarter of this year.But as reported, turnoverfell by 8%. and Duane Reade chains raised its turnoverby6.0% to US$81.0 Lower turnoverinFrance, Switzerland and the UK offset stronger billion in its financial year ended 31 August 2015, the first year as a sales in Germany, Italy and Spain. European Generics sales stalled merged entity.The division –which filled 894 million prescriptions in local currencies and fell by 13% as reported to US$661 million. –accounted for 78% of group turnoverofUS$103 billion, including Weaker contributions from generic Pulmicort (budesonide), eight-month contributions from WBA’sRetail PharmacyInternational Niaspan (extended-release niacin) and Xeloda (capecitabine) lead to and Pharmaceutical Wholesale divisions. an 8% Generics slide to US$1.03 billion in the US (see Figure 1). WBAsaid its full-year operating profit wasUS$4.67 billion – However, the Generic Medicines business segment improvedits including US$3.89 billion from the Retail PharmacyUSA division operating margin by 3.3 percentage points to 26.2%. G –asthe group achievednet synergies of US$799 million. G

Business Third-quarter sales Change Operating MERGERS&ACQUISITIONS segment (US$ millions) (%) margin (%) US 1,032 -8 – Allergan and Pfizer hold talks Europe 661 -13 – llerganand Pfizer are “in preliminary friendly discussions” Rest of World 509 -8 – Aabout amerger,although both sides stressed that no deal had Generics 2,202 -9 26.2 been struck as yet. Ireland-domiciled Allergan–which, likePfizer, Copaxone 1,085 -2 80.7 has aroster of biosimilars under development –said it had been “approached by Pfizer”. Other Specialty 1,093 +2 31.7 “Under anypotential scenario with Pfizer”, Allergansaid it OTC/Other 443 -2 13.1 remained “stronglycommitted” to closing the US$40.5 billion sale of Teva 4,823 -5 20.9* its global generics operations to Teva in the first quarter of next year. Merging with Allerganwould give US-based Pfizer the option of *includes US$848 million of unallocated corporate expenses and charges reducing its corporate tax rate through an ‘inversion’ deal that would Figure1:Breakdown by business segment of Teva’s sales and operatingmargin see it redomicile for tax purposes in Ireland. However, US authorities in the thirdquarter of 2015 (Source –Teva) may seek to derail anyagreement. G

6November 2015 GENERICS bulletin 3 Gen 6-11-15 Pgs. 2-12_Layout 1 04/11/2015 17:39 Page 4

COMPANY NEWS

BUSINESS STRATEGY/THIRD-QUARTER RESULTS BUSINESS STRATEGY Embattled Valeant is New Zealand’sAFT trying to fightback weighsinitial listing

aleant is attempting to fight back against pressure on its pricing ew Zealand’sAFT Pharmaceuticals has revealed it is “considering” Vpolicies, accounting practices and relationships with US Specialty Nan initial public offering (IPO) to help the privately-owned firm Pharmacies that has seen it come under fire from US senators and accelerate its international growth. attorneys-general, as well as from investors. HartleyAtkinson, AFT’schief executive officer,said the “time is Over the past couple of weeks, the Canadian firm has seen its right” for the companytoconsider an IPO and listing on NewZealand’s share price tumble by more than two-fifths, from around US$175 NZX Main Board and the Australian Securities Exchange (ASX) to to about US$100 as Generics bulletin went to press. raise capital and “embark on the next phase of global growth”. Subpoenas from attorney-generals in Massachusetts and NewYork Auckland-based AFT markets over100 prescription and OTC have demanded materialonissues including pricing decisions, product medicines in more than 40 countries, including several drugs listed distribution and patient-assistance programmes. Several lawfirms have on Australia’sPharmaceutical Benefits Schedule (PBS) or supplied also started class-action suits on behalf of shareholders. through NewZealand’sPharmac tenders, as well as through affiliates In response, Valeant has severed its ties with specialty pharmacy in Malaysia and Singapore. It generated sales of NZ$75.9 million Philidor,which represented 6.8% of the firm’sthird-quarter turnover, (US$51.4million) in 2014, having achievedacompound annual formed an ad hoc committee to reviewallegations about the firm’s growth rate (CAGR) of 21% overthe past 10 years. operations, mooted selling or spinning offits neurology portfolio and “Raising newcapital is really about taking this business to the stressed to investors its diversified business model. next level,”Atkinson explained, “and advancing our portfolio of As part of that model, Valeant has just closed its US$800 million innovative development products.”Additional investment would be acquisition of Egyptian branded generics specialist Amoun (Generics needed to complete clinical development and market entry for the bulletin,7August 2015, page 3). firm’spipeline, he explained. A24% slide to US$225 million in its Europe, Middle East and Africa region that wasalmost entirely attributable to exchange-rate Well set up on the global stage effects wasthe main reason for Valeant’sEmerging Markets sales Claiming that AFT was“set up to perform well on the world stage,” falling by 15% to US$466 million in the third quarter of 2015. Latin Atkinson maintained that the companyhad developed a“good track American sales slid by 18% to US$92.6 million for the same reason, record” in terms of product development, regulatory approvals, butturnoverinAsia rose by 7% to US$149 million. licensing and distribution. Valeant said it had benefitted from sales rises of 23% in China, “Our first patented development product, Maxigesic (paracetamol/ 10% in Mexico and 15% in South Korea. ibuprofen), is already approvedand licensed in multiple European A54% leap to US$2.32 billion in sales in Developed Markets countries,”Atkinson pointed out. pushed up the group’sturnoverby36% to US$2.79 billion. Valeant At present, the Atkinson family owns 87% of the company, with said that equated to 13% organic growth, two-thirds of which wasdue institutional and individual investors holding the other 13%. to volume gains and athird to price rises. But the group’soperating AFT noted that afinal decision on launching the IPO had not yet profit fell by athird to US$448 million, due in part to higher research been made, butpotential investors were able to register “preliminary and development expenses. G indications of interest” with investment firm First NZ Capital. G

6November 2015 Issue 241 Individual subscriptions Te rms &Conditions: These can be viewedinfull at www.Generics-bulletin.com/subscribe. Editor: Aidan Fry An annual subscription comprises: No partofthis publication maybecopied, reproduced, Deputy Editor: David Wallace ■ 20 Generics bulletin newsletters; ■ AND at least 46 weekly News@Genericsbulletin stored in aretrieval system, distributed or transmitted Business Reporter: Dean Rudge electronic newsflashes containing the week’stop by anymeans, including electronic,mechanical, Business Reporter: JakeNinan news stories (currentlydelivered by email). photocopying or recording, without the prior written Production Controller: Debi Minal permission of the publisher,orunder the terms and Choice of formats conditions of aGlobal Site Licence or of alicence Production Editor: Jenna Meredith The 20 Generics bulletin newsletters areavailable: issued by the Copyright Licensing Agency (CLA) in Director of Subscriptions: ValDavis ■ EITHER as the digital Generics bulletin-i for London, UK, or rights bodies in other countries that Group Sales Manager: Rob Coulson online access by desktop,and tablet and smartphone. have reciprocal agreements with the CLA. Awards Manager: Natalie Cornwell Mobile devices can have Apple or Android Neither maythis publication be exported, distributed Managing Director: MikeRice operating systems. or circulated by anymeans without the prior written ■ OR in traditional hard-copyprint format, permission of the publisher. Editorial enquiries: GENERICS bulletin, delivered by airmail. While due carehas been taken to ensurethe accuracy 4Poplar Road, Dorridge,Solihull, of information contained in this publication, the Corporate and multiple subscriptions West Midlands B93 8DB, UK. publisher makes no claim that it is free of errorand Website: www.Generics-bulletin.com Global Site Licences areavailable to companies. disclaims anyliability whatsoeverfor anydecisions or Te l: +44 (0)1564 777550 Fax: +44 (0)1564 777524 These provide in-house electronic access forstaff to actions taken as aresult of its contents. E-mail: [email protected] Generics bulletin and News@Genericsbulletin. ©OTC Publications Ltd.All rights reserved. Advertising enquiries: Please ask foraquotation. Generics bulletin® is registered as atrademark in the European Community. As above,[email protected] Discounted multiple subscriptions areavailable to ISSN 1742-0784. Generics bulletin-i at the same location. SUBSCRIPTIONS Companyregistered in England No 2765878. Subscription rates arepublished at Subscription enquiries: Printed by Warwick Printing CompanyLimited, www.Generics-bulletin.com/subscribe. Contact [email protected] Leamington Spa CV31 1QD, UK.

4 GENERICS bulletin 6November 2015 Gen 6-11-15 Pgs. 2-12_Layout 1 04/11/2015 17:39 Page 5

COMPANY NEWS

BUSINESS STRATEGY/THIRD-QUARTER RESULTS BUSINESS STRATEGY/THIRD-QUARTER RESULTS Ophthalmicand OTC Perrigo unveils plan areMylanpriorities to contest Mylan bid

trengthening its position in both the ophthalmics and OTCsectors errigo plans to slash 800 jobs, streamline its organisation, buy Sof the pharma market are among Mylan’stop business-development Pback up to US$2 billion of its shares, consolidate its supply-chain priorities as it continues to pursue ahostile takeoverbid for store- and procurement activities in Ireland and divest its US vitamins, minerals brand specialist Perrigo. and supplements (VMS) business as part of acost-cutting initiative Heather Bresch, Mylan’schief executive officer,identified designed to “delivervalue farsuperior” to Mylan’shostile takeover ophthalmic drugs as atherapeuticcategory in which the companycould approach and “drive substantial profit growth in 2016 and beyond”. seek bolt-on acquisitions to attain critical mass. Group president Rajiv Forming part of Perrigo’sorganisation streamlining, the 800 planned Malik noted that Mylan had “a bunch of ophthalmic products” in its job cuts –representing around 6% of the store-brand specialist’sglobal global portfolio and wasawaiting news from the US Food and Drug workforce –are intended to eliminate “redundant administrative Administration (FDA) on an abbreviated newdrug application(ANDA) functions”. Meanwhile, aresearch and development and supply-chain for ageneric rivaltoRestasis (cyclosporin) that it filed twoyears ago. centre of excellence in Ireland –Perrigo’shome for tax purposes –is To overviewits push into the OTCsector,Mylan has just appointed set to deliverannual savings of around US$105 million, in part through former GlaxoSmithKline Consumer executive Ranjan Chaudhuri as enhanced “purchasing power”. And selling the VMS unit is designed the global commercial leader for its OTCbusiness. He will report to to improve the group’soperating margin and return on capital. Malik, who noted that Chaudhuri would be part of ateam to replace To oversee the programme –which is expected to generate anyPerrigo executiveswho chose to quit if Mylan’stakeoveroffer “operational and tax benefits of US$175 million on an annualised run succeeded after the deadline for tendering shares on 13 November. rate basis” –Perrigo has promoted to companypresident its global Bresch said acquiring Perrigo and its Omega platform in Europe would accelerate Mylan’sOTC focus. However, she added, “we believe Business Third-quarter sales Change Operating there are great product opportunities in other assets out there that would segment (US$ millions) (%) margin (%) let us continue to build in OTC, both in the US and the rest of the world”. Consumer Healthcare675.2 +5 17.4 Several OTCproducts were among more than 100 drugs that Mylan picked up in February through its US$6.31 billion acquisition Branded Consumer 302.2 –1.4 of Abbott’sEstablished Products business outside of the US. Prescription 260.3 +34 34.9 The Abbott deal added US$314 million to Mylan’sEuropean Specialty Science 84.5 -8 10.7 Generics turnoverthat rose by 74%, or US$260 million, to US$612 API/Other 22.5 -9 27.5 million in the third quarter of this year (see Figure 1). On aconstant- Perrigo 1,344.7 +41 14.0 currencybasis, the growth was89%. Mylan said it had gained market share in France, while its Sirdupla (salmeterol/fluticasone) respiratory Figure1:Breakdown by business segment of Perrigo’s sales and operating generic wasbeing dispensed by 500 out of 1,160 UK clinical groups. margin in its financial thirdquarter ended 26 September 2015 (Source –Perrigo) Abbott’sEstablished Products operation in Canada contributed around US$42 million to Mylan’sNorth AmericanGenerics sales that operations and supply chain head, John Hendrickson. He takes the increased by 28% to US$1.08 billion, aided by 14 launches during title from chairman and chief executive officer Joe Papa, who had the quarter,including fluvastatin, lidocaine patches and paliperidone. served in the role since joining the firm in 2006 (see page 27). IncludingUS$105 million from the Abbott deal, Generics turnover Insisting that the programme made “the gross inadequacyof in Mylan’sRest of the World region grewbyathird, and by 47% on a Mylan’soffer clearer than ever”, Papa commented that Mylan’sclaims constant-currencybasis, to US$547 million. The firm credited recent regarding “synergies, benefits of its expected vertical integration and launches in Australia and Japan, as well as growth from its operation its ability to manage our business” were “simply wrong”. It was in Brazil and its Indian antiretroviral franchise. moreover“fundamentally irrational to believe that Mylan can run this Mylan’sgroup turnoverincreased by 29% to US$2.70 billion, business better or more profitably than our team”, he said. Mylan’s generating an operating profit 21% higher at US$601 million. G hostile takeoveroffer is set to expire on 13 November. “The actions we are announcing today are the next step in our strategy to leverage the powerful global platform we have built,” Business Third-quarter sales Change Abbott contribution said Papa, pointing to the firm’sacquisition of Elan at the end of segment (US$ millions) (%) (US$ millions) 2013 and Omega Pharma in March this year. North America 1,080 +28 42 In the third quarter of this year,Perrigo’sPrescription business Europe 612 +74 314 reported an operating margin of 34.9% –upfrom 33.3% in the third Rest of World 547 +32 105 quarter of last year –onsales that jumped by more than athird to Generics 2,238 +39 – US$260 million. Having just launched asubstitutablegeneric version of Valeant’sBenzaClin (clindamycin/benzoyl peroxide) 1%/5% gel Specialty 438 -5 – (Generics bulletin,2October 2015, page 24), Perrigo said newproduct Other 19 –– launches had added US$18 million to its sales, with the remaining US$47 million coming from higher sales of existing products. Mylan 2,695 +29 462 Prescription turnovermade up just under afifth of group sales that advanced by 41% to US$1.34 billion (see Figure 1). Perrigo Figure1:Breakdown by business segment and region of Mylan’s sales in the thirdquarter of 2015 along with the sales contribution from the acquired Abbott pointed out that its group sales had grown by 10% on an organic, Established Products business (Source –Mylan) constant-currencybasis, an increase of US$95 million. G

6November 2015 GENERICS bulletin 5 Gen 6-11-15 Pgs. 2-12_Layout 1 04/11/2015 17:39 Page 6

COMPANY NEWS

MERGERS&ACQUISITIONS/SECOND-QUARTERRESULTS BUSINESS STRATEGY/SECOND-QUARTERRESULTS Strides strengthens Reddy’ssees Russia with two purchases as biosimilars target

ndia’sStrides Arcolab is increasing its Indian brands portfolio by olling out biosimilars in emerging markets is a“keyinitiative” Iacquiring sevenbrands from Johnson&Johnson and purchasing Rfor Dr Reddy’sLaboratories, and the firm is “putting efforts” amajority stakeinthe domestic business of Medispan, alocal company to try and makeits presence “reasonably meaningful in the next two focused on pharmaceuticals and nutraceuticals. years to three years”, according to the Indian firm’schief operating The sevenJohnson &Johnson brands “to be launched immediately” officer,Abhijit Mukherjee. are spread across the analgesic, antiemetic and dermatology segments. Noting that Reddy’splans “may not be meaningful in the very- Theyinclude Otogesic (benzocaine/antipyrine/phenylephrine) eardrops, short term”, Mukherjee identified Russia as amarket that the Indian Ethnorub (mephenesin) ointment and Stugil (domperidone) tablets. firm would look to penetrate“maybe in afew quarters’[time]”, while Through amajority stakeinthe Indian operations of Medispan – Reddy’swould look at “out-licensing in all of the bigger markets”. the pharmaceutical arm of the Shriram group –Strides will “gain entry “Nowthat we are beginning to have more data on some of the products into the niche probiotics segment” through brands such as Lactogut and regulatory bodies are willing to accept filings, we would scale [our and Lactovit. The majority holding, including intellectual property, biosimilarplans] up,”hesaid. “I think maybe in hindsight we could will be transferred to the Strides Biologix Private vehicle, in which have movedalittle faster afew years back, butbetter late than never.” the Indian firm will hold a51% stake. Speaking to investors as Reddy’sreported sales in emerging Strides said the twoacquisitions, upon closing, would have a markets that fell by 22% to Rs6.62 billion (US$101 million) in its combined sales potential of Rs320 million (US$4.93 million) in its current financial year ending 31 March 2016. And once combined Second-quarter sales Change Proportion of with the firm’srecent agreement with Sun to buyRanbaxy’sSolus (Rs millions) (%) total (%) and SolusCare central nervous system divisions (Generics bulletin, North America 18,563 +32 47 2October 2015, page 9), the total boost to turnovercould be “at least Emerging Markets* 6,617 -22 17 Rs1.00 billion” per year. India 5,464 +14 14 Strides’ pending takeoveroffellowIndian firm Shasun has also Europe 2,124 +65 5 advanced, as India’sForeign Investment Promotion Board approved Global Generics 32,768 +15 82 the firm’sproposal for issuing shares to non-resident shareholders. Pharma Services, APIs 5,918 -7 15 Consolidating its acquisition of Aspen’sArrowbusiness in Australia (Generics bulletin,5June 2015, page 3) from 1September helped to Proprietary Products/other 1,204 +37 3 raise Strides’ group turnoverby28% to Rs3.74 billion in its financial Dr Reddy’s39,890 +11 100 second quarter ended 30 September 2015. *Emerging Markets refers to Russia, Commonwealth of Independent States countries, Arrow’simpact and launching benzonatate soft-gel capsules upon Romania and Rest of the World markets including Venezuela approvalinthe US were driving factors behind a47% sales leap to Rs1.44 billion by Strides’ Regulated Markets unit (see Figure 1). The Figure1:Breakdown by region and business of Dr Reddy’s Laboratories’ sales in Indian companycurrently has 16 abbreviated newdrug applications its financial second quarter ended 30 September 2015 (Source –DrReddy’s) (ANDAs) pendingUSapproval. financial second quarter ended 30 September 2015, Mukherjee Ramping up its malaria portfolio and starting sales of the commented that the “impact of macroeconomic factors” wasdriving hepatitis Ctreatment Virso (sofosbuvir) in emerging markets lifted Reddy’sto“broaden our product portfolio in existing [emerging Institutional turnoverby47% to Rs1.19 billion. Strides plans to “scale markets] and enter newcountries to leverage our global portfolio”. up the Institutional business through backward integration”. Meanwhile, the firm revealed, customers for twoofReddy’sactive But Emerging Markets sales slipped by 3% to Rs1.11 billion on pharmaceutical ingredients(APIs) had their abbreviated newdrug “delays in generics sales in afew countries”. Strides said it wasfocusing application (ANDA) approvals rescinded by the US Food and Drug on shifting its product mix in Africa towards brands to deliver“superior Administration (FDA), on the basis that the Indian firm’sAPI facility margin performance”. wasclassified as potential ‘Official Action Indicated’ (OAI) on the Having obtained regulatory clearance to conduct aPhase Iclinical date of approval. “Dr Reddy’scontinues to cooperate with the FDA trial in Australia for its first biosimilar molecule, Strides also intends in connection with pending Form 483 observations,”the Indian firm to spin offBiotech into aseparate listed entity while retaining 20% stated, “and awaits further advice from the agencyonthis matter.” ownership in the company. Furthermore, the firm plans shortly to Despite those falling emerging market sales, an advance of almost start building abiopharma facility near Bangalore, India. G athird to Rs18.6 billion in North America –following the “sustained performance of the injectables franchise,market share gains in key Second-quarter sales Change Proportion of molecules” and recent launches including memantine, valganciclovir (Rs millions) (%) total (%) and sirolimus –allowed Dr Reddy’storeport second-quarter Global Generics sales ahead by 15% to Rs32.8 billion. Regulated markets 1,440 +47 38 Generics turnoverinEurope leapt by two-thirds, while the Indian Institutional business 1,192 +47 32 firm’sdomestic Generics sales climbed by 14% (see Figure 1). Emerging markets 1,108 -3 30 Includingproprietary brands and its Pharmaceutical Services and Active Ingredients (PSAI) unit, Dr Reddy’sraised its group turnover Strides Arcolab 3,740 28 100 by 11% to Rs39.9 billion. With operating expenses only marginally Figure1:Breakdown by business segment of Strides Arcolab’s sales in its higher,the Indian firm’soperating profit increasedbymore than two- financial second quarter ended 30 September 2015 (Source –Strides Arcolab) fifths to Rs9.26 billion. G

6 GENERICS bulletin 6November 2015 Gen 6-11-15 Pgs. 2-12_Layout 1 04/11/2015 17:39 Page 7

COMPANY NEWS

MANUFACTURING/THIRD-QUARTER RESULTS Indian warning mars Sandoz’ performance

warning letter issued by the US Food and Drug Administration Region Third-quarter sales Reported Constant-currency A(FDA) against Sandoz’ production sites in Kalwe and Turbhe, (US$ millions) change (%) change (%) India, took the gloss offthe firm’sthird-quarter performance that included 9% constant-currencysales growth, acceptance by the FDA Europe 975 -13 +6 of the firm’ssubmission for abiosimilar rivaltoEnbrel (etanercept) US 921 +9 +10 and the US launch of Zarxio (filgrastim-sndz). Asia, Africa, Australasia 289 +1 +13 Sandoz said the warning letter issued by the FDAon22October – Canada, Latin America 141 -8 +15 which the agencyhad not yet made public as Generics bulletin went to press –followed inspections at both sites conducted last year and Sandoz 2,326 -3 +9 was“related to deficiencies in current good manufacturing practice Established markets 1,791 ±0 +9 (cGMP) for finished pharmaceuticals”. Emerging markets 535 -13 +8 “The warning letter does not contain anynew issues versus the Form 483 observations issued following the inspections in August 2014, Figure1:Breakdown by business segment of Sandoz’ sales in the thirdquarter which Sandoz has been addressing since then,”parent companyNovartis of 2015 (Source –Sandoz) stated. “Sandoz will continue to work closely with the FDAtoensure (somatropin) biosimilars,plus Glatopa and contract-manufacturing all observations are resolved to the agency’sfull satisfaction,”it revenues, Sandoz raised its Biopharmaceuticals sales by 28% on a pledged, adding that “no supply disruptions are expected”. constant-currencybasis to US$186 million in the third quarter of 2015. Noting that the group had recently decided to close the Turbhe Partner-label and finished-dose Anti-Infectivessales ahead by antibiotics site (Generics bulletin,7August 2015, page 6), Novartis’ 15% on the same basis added another US$349 million to Sandoz’ total chief executive officer Joe Jimenez said “a lot of the remediation has turnoverthat grewby9%onaconstant-currencybasis, butfell by 3% already taken place” at the Kalwe solid-dose plant, giventhat the as reported, to US$2.33 billion. Volume growth of 21 percentage inspection had taken place more than ayear ago. points outweighed 12 points of price erosion, half of which wasdue During the first nine months of this year,Sandoz had passed all to greater competition to the firm’sUSauthorised generic of Novartis’ 48 of the regulatory inspections of its sites with good or acceptable Diovan(valsartan) antihypertensive. outcomes, Jimenez pointed out. The negative Diovanimpact in the US wascancelled out by Highlighting the launch of Zarxio in early September following launching Glatopa, Zarxio and authorised generic Exelon (rivastigmine) alegal battle with Amgen (Generics bulletin,11September 2015, patches (Generics bulletin,11September 2015, page 17), as well by page 19), Jimenez said the US filing of its GP2015 etanercept “continued strong growth in dermatology”. Sandoz raised its US sales candidate –which covers all indications listed in Enbrel’slabel –was by around atenth to US$921 million (see Figure 1). one of 10 major biosimilarsubmissions that Sandoz intended to make Sales in Western Europe increased by 4% at constant exchange overthe next three years. rates to US$632 million, led by rises of 8% in Germanyand 7% in Sandoz has already conducted Phase III clinical trials for its Italy,partially offset by a3%dip in France. And even though the firm LA-EP2006 pegfilgrastim and HX575 epoetin alfacandidates, while suffered a5%fall in Russia, sales in Central and Eastern Europe during the first half of 2015 it completed recruitment for Phase III advanced by 2% to US$258 million. studies for its GP2013 rituximab and GP2017 adalimumab projects. On aconstant-currencybasis, Sandoz achievedturnovergrowth Divisional head Richard Francis said the US launch of Glatopa of 17% to US$165 million in its Asia-Pacific region on sales rises of (glatiramer acetate), the first generic version of Teva’s Copaxone 18% in China and 23% in Japan. A24% advance in Brazil lay behind blockbuster,was “going according to plan”. “It has been very well 21% turnovergrowth to US$67 million in Latin America. receivedbypayers, pharmacybenefit managers (PBMs) and the trade, Sandoz improvedits operating profit by 17% as reported, and by and currently our patient share sits at around 30%,”herevealed, adding athird at constant currencies, to US$317 million. Cutting the division’s that the firm’slaunch strategy wasbased on “managing price and sales and marketing costs by 9% to US$381 million, and reducing its volume to makesure we bring value to payers, patients and ourselves” research and development investment by 5% to US$190 million, helped (Generics bulletin,26June 2015, page 1). to bolster its operating margin by 2.3 percentage points to 13.6%. On an Includingthe Zarxio/Zarzio, Binocrit (epoetin alfa) and Omnitrope adjusted ‘core’ basis, the margin grewby1.2 points to 18.6%. G

THIRD-QUARTER RESULTS BUSINESS STRATEGY Pfizer falls despite Hospira Cipla sells biosimilars holding ospira’sUSoperations contributed US$330 million to Pfizer’s ipla has agreed to sell its 25% stakeinBiomab Holding, aHong HEstablished Products business in the third quarter of this year after CKong-based companydeveloping biosimilars for the Chinese the US-based originator completed aUS$17 billion takeoverdeal on market, to the majority shareholder,Biomab Brilliant, for almost 3September.Under its accounting practices,Pfizer booked amonth US$25.8 million. The Indian companyplans to consolidate its biological of Hospira’ssales in the US, butnone in other territories. business under the Cipla BioTec banner with afocus on “global product Nevertheless, Pfizer’sEstablished Products sales fell by 16% as development” of developing, making and marketing biosimilars for reported –and by 8% on aconstant-currency‘operational’basis –to treating auto-immune diseases, cancer,diabetes and respiratory diseases. US$5.22 billion. Excluding Hospira, the respective falls were 22% and Five years ago, Cipla pledged to invest US$65 million in adeal 13% to US$4.89 billion following losses of exclusivity for Celebrex that sawittakethe 25% stakeinBiomab along with a40% holding (celecoxib) in the US and for Lyrica (pregabalin) in Europe. G in India’sMabPharm (Generics bulletin,30June 2010, page 3). G

6November 2015 GENERICS bulletin 7 Gen 6-11-15 Pgs. 2-12_Layout 1 04/11/2015 17:39 Page 8

COMPANY NEWS

BUSINESS STRATEGY/SECOND-QUARTERRESULTS BUSINESS STRATEGY/NINE-MONTHRESULTS Biocon targets filings Kabi “fully on track” in EU and US in 2017 for cost-cutting plan

iocon is “on track” to begin submitting regulatory filings in the resenius Kabi’s C100 million (US$110 million) cost-cuttingdrive BUS and Europe for some of the five biosimilarprogrammes Faimed at improving production efficiencyand streamlining that are currently in clinical development during its next financial year administrative structures remains “fully on track”, according to the ending 31 March 2017, according to the Indian firm’schairperson German group. Aimed at producing savings of C10 million this year, and managing director,Kiran Mazumdar-Shaw. and C40 million annually by 2018, the initiative had in the first nine Through apartnership with Mylan, Biocon is currently developing months of 2015 cost the firm C50 million to implement,itsaid, with biosimilars including trastuzumab, bevacizumab, adalimumab and the remaining C50 million charge to be recorded in the fourth quarter. pegfilgrastim, while the Indian firm also has abiosimilar insulin Around two-thirds of targeted savings through the initiative – glargine, which it earlier this year launched in Mexico (Generics which wasunveiled at the beginning of this year (Generics bulletin, bulletin,24April 2015, page 21). 13 March 2015, page 10) –are to be achievedinEurope, with the other Providing details of its biosimilars pipeline, Biocon said patient third to be derivedfrom operationsinthe firm’sAfrica, Asia-Pacific recruitment for global Phase III clinical trials for pegfilgrastim and and Latin America regions. trastuzumab was“nearing completion”,while aglobal Phase III In the first nine months of this year,launching sevennew clinical trial for adalimumab was“progressing well across multiple products coupled with “persistent intravenous drug shortages” helped sites”. “The global Phase Ipharmacokinetic study for bevacizumab Fresenius Kabi to increase its North America sales as reported by is approaching completion while the rest of world (ROW)focused almost two-fifths to C1.56 billion, more than outweighing organic Phase III trial is advancing as planned,”the Indian firm commented, growth of 16%. reiterating that patient recruitment for aglobal Phase III clinical trial Those US launches included the recent introductions of for insulin glargine had been completed earlier this year. moxifloxacin in the German firm’sproprietary Freeflexinfusion bag Biocon said it was“continuing to pursue licensing opportunities in emerging markets” for trastuzumab and insulin glargine, and Region Nine-month sales Reported Organic expected to “commence sales of these products in some of these (C millions) change (%) change (%) markets” during its current financial year.The Indian firm had just Europe 1,566 +2 +4 receivedapprovalfor trastuzumab in Algeria, Mazumdar-Shawsaid. North America 1,555 +39 +16 Meanwhile, the Indian firm said it would soon be able to vertically Asia-Pacific 862 +19 +4 integrate its future oncology abbreviated newdrug application(ANDA) filings after acquiring from 1October “business assets” –including Latin America/Africa 448 +18 +12 aUSFood and Drug Administration approvedsynthesis manufacturing Fresenius Kabi 4,431 +18 +9 facility in Vishakhapatnam, India –from local firm Acacia Life Sciences. “[The site] presently manufactures advanced intermediates Figure1:Breakdown by region of Fresenius Kabi’s sales in the first nine months of potent active pharmaceutical ingredients(APIs), with sales to of 2015 (Source –Fresenius Kabi) customers in India and overseas,”Biocon commented. (Generics bulletin,2October 2015, page 23), ageneric version of That acquisition came soon after Biocon opened a10,000 sq m AbbVie’sNimbex(cisatracurium besylate) injectable and glucagon insulin devices facility in Bangalore, India, at the same time launching hydrochloride powder for infusion, as well as enoxaparin and its Basalog One ready-to-use insulin glargine disposable pen in India neostigmine earlier in the year. (Generics bulletin,2October 2015, page 10). Moreover, Biocon noted North American sales thus amounted to around 35% of the firm’s that its insulins manufacturing facility in Malaysia was“progressing sales that rose by 18% as reported to C4.43 billion, equivalent to 9% towards qualification”, with filings in emerging markets also anticipated growth on an organic basis, and 8% in constancy-currencyterms. from the site in fiscal 2017. A‘fill-finish’ biosimilars facility,also Moreover, almost exactly the same contribution to total located in Bangalore, is “on track” for “qualification” during its turnoverasinthe US came in Europe, where sales inched forward 2017-2018 financial year. by areported 2% to C1.57 billion. This translated to 4% organic In its financial second quarter ended 30 September 2015, contract growth, and Kabi noted that it was“fully on track” to meet full-year research service sales through its Syngene division ahead by 30% organic sales growth guidance of 3-5%. Sales in Kabi’sAsia-Pacific to Rs2.50 billion (US$38.2 million) helped overcome lowsingle- and Latin America/Africa businesses, meanwhile, both rose as digit growth across Biocon’sBiopharmaceuticals business to push reported by just under afifth –the former by 19% to C862 million group turnoverahead by 11% to Rs8.28 billion. Biopharma sales and the latter by 18% to C448 million. made up the bulk of Biopharmaceuticals turnoverthat increased by The German firm’searnings before interest and tax (EBIT) 4% to Rs5.78 billion, advancing by the same amount to Rs4.59 billion. improvedby38% to C872 million, giving it an EBIT margin Branded formulations sales ahead by 3% added Rs1.19 billion. almost three percentage-points higher at 19.7%. G “The overall performance of the Biopharma business wasaffected due to slowoff-takeofsome of the APIs and capacity constraints,” IN BRIEF the Indian firm explained, adding that it was“taking steps to address this challenge”. LANNETT expects to report sales growth of around 13% to Despite aspikeinresearch and development costs arising from US$106 million in its financial first quarter ended 30 September Biocon advancing both its biosimilars and novelbiological pipeline 2015. The US generics specialist said it had enjoyed “higher sales the Indian firm’searnings before interest, tax, depreciation and volumes across anumber of its core products”. G amortisation (EBITDA) rose by 18% to Rs2.22 billion. G

8 GENERICS bulletin 6November 2015

Gen 6-11-15 Pgs. 2-12_Layout 1 04/11/2015 17:39 Page 10

COMPANY NEWS

THIRD-QUARTER RESULTS IN BRIEF GEDEON RICHTER has acquired for an undisclosed fee the Authorised launches remaining 49% stakeinits Curaçao-based female healthcare distributor Mediplus that it did not previously own. Having bought its majority 51% stakeinMediplus around 18 months ago, the Hungarian firm had at that time announced that it would seek to aid Sanofi Generics acquire the remainder of Mediplus “overthe next three years” (Generics bulletin,6June 2014, page 9). “This step underlines the ecent launches of authorised generics of its Lovenox (enoxaparin) strategic aim towards the diversification of Richter’sfast-growing Rbrand in the US and its Plavix (clopidogrel) blockbuster in Japan geographic presence in Latin America,” the companycommented, helped Sanofitoreport global Generics sales ahead by 0.2% to pointing out that Mediplus covered countries in the region including C452 million (US$494 million) in the third quarter of this year.On Bolivia, Chile, Ecuador and Peru. aconstant-currency-basis, this translated to arise of 6.7%. US Generics sales advanced by 10.7% to C36 million on a BEXIMCO PHARMA raised its turnoverby16.5% to BDT9.63 constant-currencybasis, while the rise in Western Europe was5.6% to billion (US$123 million) in the first nine months of this year.The C135 million. TurnoverinEmerging Markets climbed by 4.5% on the Bangladeshi companyimprovedits operating profit by 16.1% to same basis to C262 million, while sales in Sanofi’sRest of the World BDT2.06 billion. region increased by 63.6% to C19 million. Generics accounted for 4.7% of Sanofi’sgroup turnoverthat PRO DOC –the generics subsidiary of Canadian pharmacychain improvedby9.2% as reported –and by 3.4% at constant exchange Jean Coutu –reported an increase in sales of 3% to C$99.3 million rates –toC9.59 billion, despite biosimilarcompetition to its Lantus (US$75.3million) in its financial first half ended 29 August 2015. (insulin glargine) diabetes blockbuster in European countries including The rise helped to increase Jean Coutu’sgroup turnoverby2.6% Denmark, Germany, the Netherlands and the UK, as well as in Japan. to C$1.40 billion. Generics accounted for 70.0% of prescriptions Sanofi–which said it had completed patient recruitment for two dispensed by Jean Coutu pharmaciesduring the second quarter of Phase III studies for biosimilar insulin lispro –reported nine-month the group’sfinancial year,arise of almost twopercentage points. Generics sales ahead by 8.4% to C1.45 billion, equivalent to an 8.7% constant-currencylift. G BELOTECA –the privately-owned US sterile drugs developer –has opened a product-development laboratory in San Diego, California. Fred Defesche, chief executive officer of Beloteca, said the SECOND-QUARTERRESULTS laboratory would allow“Beloteca to takegreater control overproject US Abilify rival lifts Torrent timelines and the development process.” AUROBINDO has obtained local planning clearancetobuild a ntroducing ageneric version of Abilify (aripiprazole) in the US amid 52,500 sq mUSmanufacturing, warehousing and distribution I“limited competition” helped to quadruple Torrent’sUSturnover centre in East Windsor,New Jersey. The Indian companyalready has in the Indian company’sfinancial second quarter ended 30 September several other facilities in NewJersey. 2015. Torrent –which receivedUSFood and Drug Administration approvalfor aripiprazole on 28 April this year,atthe same time as MEGAFINE PHARMA has seen products made at its Indian Alembic, Hetero and Teva (Generics bulletin,8May 2015, page 16) – facility in Lakhamapur,Maharashtra, banned from import into reported group sales ahead by 39% to Rs16.9billion (US$259 million). in the US under an import alert issued by the US Food and Drug The rapid US rise more than offset an 18% sales decline to Administration (FDA). Rs1.31 billion in Brazil, although Torrent said this equated to 19% constant-currencygrowth. The firm’stotal sales outside of India shot MARTINDALE PHARMA says it has wonatender to supply more up by 68% to Rs11.1 billion. than 20 drugs for the ‘Essential medicines buffer stockpile’ In its domestic market, the Indian group blamed discontinuing maintained by the UK’sDepartment of Health. The four-year contract “certain promotional schemes and hygiene initiatives” for local covered products with acombined value of £3.6 million (US$5.6 turnovercreeping up by 1% to Rs5.46billion on the back of stronger million), said the UK-based company, which has just extended for contract-manufacturing revenues. From mid-July,the Indian figures another three years its exclusive distribution deal for hospital included the impact of acquiring dermatology player Zyg Pharma products with Celesio’sAAH Pharmaceuticals. (Generics bulletin,7August 2015, page 10). Torrent more than trebled its pre-tax profit to Rs7.32 billion. G INVAGEN has been sued in aNew York district court by product- development specialist PuraCap Pharmaceutical.PuraCap claims InvaGen was“legally prohibited” from negotiating its takeoverby MANUFACTURING Indian companyCipla in aUS$550 million deal (Generics bulletin, Infa’s Spanish site has US nod 11 September 2015, page 3). ABBOTT increased its Established Pharmaceuticals by aquarter nfaGroup says its Derivados Quimicos active pharmaceutical to US$961 million in the third quarter of this year.Onaconstant- Iingredient (API) and intermediates facility in Spain passed agood currencybasis, the growth was42.6%. Sales in ‘key emerging manufacturing practice (GMP) inspection by the US Food and Drug markets’ advanced by 18.9% to US$698 million, butgrowth was Administration (FDA) “with only one minor Form 483 observation”. almost twice as high at 37.1% constant exchange rates, led by “India, The group’sLabochim and Sifavitor plants in Italy passed similar Russia, Brazil, China and several markets through Latin America”. inspections earlier this year. Established Pharmaceuticals accounted for nearly afifth of Abbott’s Chairman Daniele Cardoso said the outcome “confirms our group sales that rose by 1.4% to US$5.15 billion. G commitment to maintain high quality standards at all our sites”. G

10 GENERICS bulletin 6November 2015 Gen 6-11-15 Pgs. 2-12_Layout 1 04/11/2015 17:39 Page 11

COMPANY NEWS

SECOND-QUARTERRESULTS BUSINESS STRATEGY/THIRD-QUARTER RESULTS Glenmark overcomes IGI changes identity LatinAmerican fall to becomeTeligent

trong growth in India, the US and Europe wasmore than enough S-based IGI Laboratories has adopted the name Teligent for its Sto outweigh “the devaluation of currencies in emerging markets”, Ucorporate identity and redesigned its logo to “include adistinctive including in Brazil and Russia, as Glenmark’sgroup turnoverrose by spark”, further to the company’s“transformation” into abroader-based 13.6% to Rs19.1 billion (US$292 million) in its financial second niche generics player (Generics bulletin,3November 2014, page 6). quarter ended 30 September 2015. Teligent also on 26 October begantrading on the Nasdaq stock Having in recent years been behind the US in second place as exchange under the newticker symbol ‘TLGT’. apercentage of Glenmark’sturnover, India became the firm’slargest “Weare proud of what we have accomplished so far,”commented market by value following sales growth of 27.3% to Rs6.09 billion president and chief executive officer Jason Grenfell-Gardner,“and (see Figure 1). Market share increased in several of Glenmark’s our people are energised by the opportunities we see ahead of us.” therapeutic areas, including cardiovascular,respiratory disease, In addition to acquiring three currently-marketed injectables from dermatological and diabetes drugs, as well as anti-infectives. Concordia for US$10 million in cash –“for which we have already Meanwhile, the Indian firm noted that it was“evaluating the shipped orders in October”, revealed Grenfell-Gardner –and appointing possible legaloptions”, including an appeal, after being ordered recently achief scientific officer in Steve Richardson, Teligent recently signed by aDelhi High Court to stop manufacturing, selling, marketing or aC$47 million (US$35.9 million) deal to acquire Canadian generic distributing in India its versions of Merck &Co’sJanuvia (sitagliptin) injectables firm Alveda (Generics bulletin,23October 2015, page 3). and Janumet (sitagliptin/metformin) on the grounds of patent In the third quarter of this year,Teligent’ssales leapt by three- infringement (Generics bulletin,23October 2015, page 25). quarters to US$11.6 million, with turnoverfrom its own-label topical Following sales almost doubling in Glenmark’sfinancial first generics almost trebling to US$8.7 million. And having announced quarter,Latin American turnovertumbled by 28.2% to Rs1.66 billion its tenth abbreviated newdrug application(ANDA) filing of the year, in the second, as aresult of the “significant” impact of failing to Teligent reported an operating profit of US$0.39 million, up from an operating loss of US$0.14 million in the third quarter of 2014. G Region/business Second-quarter sales Change Proportion of (Rs billions) (%) total (%) India 6,085 +27.3 32 SECOND-QUARTERRESULTS US 5,984 +17.9 31 Aripiprazole propels Alembic Latin America 1,657 -28.2 9 Europe 1,604 +22.8 8 eing among the first firms to introduceaUSrivaltoOtsuka’s Rest of World 2,109 +21.2 11 BAbilify (aripiprazole) blockbuster on day one –including 10mg and APIs 1,655 +3.7 9 15mg orally-disintegrating tablets –saw Alembic’sInternational Formulations sales almost quadruple to Rs5.71billion (US$87.9 million) Glenmark 19,094 +13.6 100 in the Indian firm’sfinancial second quarter ended 30 September 2015. Having established afront-end presence in the US Alembic Figure1:Breakdown by region and business of Glenmark’s sales in its financial second quarter ended 30 September 2015 (Source –Glenmark) also filed three abbreviated newdrug applications (ANDAs) during the quarter and receivedtwo approvals. secure local import licenses in Venezuela, on top of currency “Our facilities have been in compliance and we have received depreciation. However, the Indian firm introduced both its budesonide nine ANDAapprovals this year,” commented Alembic’sjoint-managing metered-dose inhaler (MDI) and levocetirizine/montelukast combination director,Shaunak Amin. Recently,the firm wasamong anumber of in Mexico, and also launched twoproducts in Ecuador and aproduct Indian players to receive US nods for ageneric version of Allergan’s apiece in the Caribbean region and Peru. Namenda (memantine) immediate-release tablets (Generics bulletin, In the US, approvals including voriconazole and drospirenone/ 23 October 2015, page 24). ethinylestradiol tablets came as local sales advanced by just under a With Domestic Formulation sales that inched ahead by 1% to fifth to Rs5.98 billion, while European sales ahead by 22.8% to Rs3.10 billion (see Figure 1) and active pharmaceutical ingredients Rs1.60 billion were “drivenprimarily by the German subsidiary”. Of (APIs) sales that rose by more than two-fifths to Rs1.37 billion, the the Indian firm’sfivelaunches across Europe, twowere in the Czech Indian company’sgroup turnoverleapt by 85% to Rs10.2 billion. Republic, while Glenmarkalso beganshipping recently-introduced Alembic more than trebled its pre-tax profit to Rs3.62 billion. G drugs to Germany, Slovakia and the UK. Sales in Glenmark’sRest of the World region –including African Second-quarter sales Change Proportion of and Asian markets and Russia and the Commonwealth of Independent (Rs millions) (%) total (%) States (CIS) –increased by more than afifth to Rs2.11 billion, following Intl. formulations5,709 +293 56 growth of almost athird in Asia on the back of sevenproduct launches. And reporting Active Pharmaceutical Ingredient (API) turnoverthat Indian formulations3,097 +1 30 rose by 3.7% to Rs1.66 billion, Glenmark noted that its Indian API APIs 1,372 +43 13 manufacturing facility,inAnkleshwar,had passed an inspection by Mexico’sCofepris regulatory agency. Alembic 10,177 +85 100 The Indian company’soperating profit improvedbyjust under Figure1:Breakdown by region and business of Alembic’s sales in its financial aquarter to Rs3.32 billion. G second quarter ended 30 September 2015 (Source –Alembic)

6November 2015 GENERICS bulletin 11 Gen 6-11-15 Pgs. 2-12_Layout 1 04/11/2015 17:39 Page 12

COMPANY NEWS

BUSINESS STRATEGY/SECOND-QUARTERRESULTS Lupin upbeat thatUS approvals will return

Make sure your colleagues upin is optimisticthat the current slump it is experiencing for US Lproduct approvals and launches will have “picked up” by its financial are as well informed as you fourth quarter ending 31 March 2016, according to the Indian firm’s managing director,Nilesh Gupta. “Wecontinue to invest in research and remain upbeat on the pace of approvals and launches,”Gupta said. During its financial second quarter ended 30 September 2015, Make sure your fellow directors and Lupin receivedseven approvals from the US Food and Drug Administration (FDA) and launched four newproducts in the US, executives get the latest generic medicines including aunique 40mg generic version of Eli Lilly’sCymbalta and biosimilars news and exclusive insights (duloxetine) delayed-release capsules (Generics bulletin,11September from Generics bulletin.Empower them to 2015, page 18). The Indian firm noted that it had filed five abbreviated newdrug make informed decisions and take decisive applications (ANDAs) with the US agencyduring the period, taking actions to keep your business ahead of its its total pending approvalto96, including 35 first-to-file opportunities competitors. Make sure your company has and 15 ‘exclusive’first-filer prospects. To strengthen its US portfolio and pipeline, Lupin during the quarter agreed to pay US$880 million a Corporate Subscription. for niche generics specialist Gavis Pharmaceuticals, in the process picking up the Indian firm’sfirst manufacturing facility in the US (Generics bulletin,7August 2015, page 5). Business benefits US sales fall by atenth ❖ Generics bulletin is available electronically worldwide to The ongoing slowdown in US approvals contributed to sales in all company executives the region falling by nearly atenth to Rs11.6 billion in the firm’s ❖ Keeps your business up-to-date with industry news and financial second quarter,representing adip of 14% in US dollar exclusive insights terms. Meanwhile, sales in Japan slid by 6.5% to Rs3.23 billion, ❖ A fully-searchable archive offers in-house research facilities although Lupin noted there had been a“turnaround” for its local ❖ Flexible formats –desktop, mobile and print options available KyowaCritiCare affiliate, which grewby7%onalocal-currencybasis. ❖ Flexible access –online or via company intranet However, domestic sales rising by almost atenth to Rs8.74 billion, ❖ Modest cost –available for a fraction of the price of resulting from increases for Lupin’s‘chronic’ portfolio of respiratory, multiple, individual subscriptions diabetes, cardiovascular,central nervous system and gastrointestinal treatments, coupled with strong growth in the firm’srest of the world and European regions (see Figure 1), helped overcome these declines, as total Formulations turnoverrose by 2.1% to Rs28.6 billion. Sales in South Africa, however, slid by 5.6% to Rs998 million. With sales of Lupin’sactive pharmaceutical ingredients(APIs) ahead by 1.1% to Rs3.22 billion, group turnoverinched ahead by Executives in seven 2.0% to Rs31.8 billion. But higher manufacturing and employee costs of the world’s top 10 caused Lupin’soperating profit to tumble by afifth to Rs6.72 billion, generics and biosimilars as the Indian firm’soperating margin slipped by 5.6 percentage companies are already points to 21.1%. G benefitting from a Corporate Subscription to Second-quarter sales Change Proportion of Generics bulletin. (Rs millions) (%) total (%) US 11,550 -9.2 36 India 8,738 +9.4 27 Japan 3,234 -6.5 10 Europe 1,158 +32.2 4 South Africa 998 -5.6 3 Rest of world 2,886 +52.9 9 ContactValDavis, Formulations 28,564+2.1 90 Subscriptions Director, APIs 3,219 +1.1 10 at [email protected] Lupin 31,783 +2.0 100 or telephone +44 (0) 1564 777 550 Figure1:Breakdown by region and business of Lupin’s turnover in its financial second quarter ended 30 September 2015 (Source –Lupin)

12 GENERICS bulletin 6November 2015 Gen 6-11-15 Pgs. 13-15_Layout 1 04/11/2015 17:41 Page 1

MARKET NEWS

MARKET RESEARCH REGULATORY AFFAIRS France saves C1.7bn REMS lobbying body as substitution rises must oppose misuse

avings achievedthrough using generics in France reached US lobbying group that has just been launched to help “prevent SC1.73 billion (US$1.93 billion) in 2014, according to figures that Athe weakening of all Risk Evaluation and Mitigation Strategies have just been published by local health insurer CNAM. That figure – (REMS) programmes”should join with the US Generic Pharmaceutical in line with 2013’seconomies of C1.77 billion –was bolstered by Association (GPhA) “in ensuring that REMS and similar programmes France’soverall generic substitution rate for eligible prescriptions are not misused”, the generics industry association has urged. rising to 83.3% by the end of December 2014, or an increase of 1.1 Comprising several US public health, women’shealth, health percentage points compared to the prior-year figure. professionaland disease organisations, the Patients Alliance for Drug While overall reimbursement spendingonpharmacymedicines Safety Protections says it is aiming to “advance the knowledge of rose by 3.8% to C23.0 billion, the ‘generic substitution effect’ did REMS as avital tool to improving public health and safety”. Among contribute a0.6 percentage-point reduction, CNAM observed. However, its priorities will be “to preservethe integrity of safety programmes this wasoutweighed by other factors driving the increase, including likeREMS with elements to assure safe use (ETASU)” and to “ensure higher volumes, changing reimbursement rates and ‘structural effects’. that manufacturers –innovator companies and generic manufacturers – Noting that the savings attributable to generics were slightly lower are held to the same safety requirements when designing and in 2014 than in 2013 –achange of just C34 million (see Figure 1) – conducting drug studies”. CNAM said that this waspartly explained by the narrowing difference “Although these programmes can add time and administrative between the average price of abrand and of its generic. requirementsfor health professionals and can be expensive for Meanwhile, data published as part of an annual report by France’s manufacturers to develop and operate,”the Alliance said, “these economic committee for healthcare products (CEPS) has indicated extensive safety measures are required by the US Food and Drug that generics had captured 18.2% of the value of the country’stotal Administration (FDA) under federal lawtoensure that adrug’sbenefits medicines market in 2014. Adrop of 0.5 percentagepoints compared will outweigh its risks.”Moreover, “ETASU components are rare, as to 2013’sfigure wasprincipally due to price cuts instigated by CEPS, only 36 drugs to date have these programmes”. the body observed. Meanwhile, by volume the share enjoyed by However, the GPhA’s president and chief executive officer,Chip generics rose by 0.7 percentage points to 31.6% in 2014. Davis, warned that while the associationshared with patient groups Earlier this year,France’shealth ministry announced a“national the goal of ensuring access to medicines, “this goal is compromised plan of action to promote generic medicines”that included raising each time that abrand drug companyexploits REMS or restricted levels of generic prescribing within hospitals and in outpatient care, distribution systems to delay access to generic drugs”. along with apublic communication campaign and saving around “GPhA welcomes the opportunity to engage with patient groups C350 million by 2017 through increasing by five percentage points the and others to see that REMS programmes are strengthened and used rate of prescribingwithin the country’s répertoire of generic as intended,”Davis insisted. “Yet some groups are calling for the equivalents (Generics bulletin,10April 2015, page 1). G preservation of the loopholes that makeitharder for the very patients theyrepresent to access affordable medicine.” 1,767 1,800 1,733 Reiterating the GPhA’s support for the Fair Access to Safe and  Timely (FAST) Generics Act bill introduced by Representatives 1,600 Steve Stivers and Peter Welch, Davis said the proposed legislation   1,459 would “strengthenREMS for patients by closing regulatory loopholes 1,400 1,323 1,363  used by some brand drug manufacturerstoblock generic competition, 1,200 without lowering safety standards”.

millions) 

C 1,011 In particular,Davis pointed out, “the FAST Generics Act sets forth 1,000  908 more explicit legalrequirements and processes for the acquisition of product samples by developers of generic drugs and biosimilars”. G 800 Savings ( 736 

600  400 REGULATORY AFFAIRS  2007 2008 2009 2010 2011 2012 2013 2014      Verification advances in EU Figure1:Savings achieved in France through generic substitution between 2007 and 2014 (Source –CNAM) “major step” in assuring compliance with state-of-the-art standards Aof medicines verification in Europe has been taken, according to IN BRIEF the European Medicines Verification Organisation (EMVO), with the signing of an agreement on conformity assessments with the European SOUTH AFRICA has taken astep towards establishing anew Directorate for the Quality of Medicines &Healthcare (EDQM). medicines regulator,the South African Health Product Regulatory “The purpose of these conformity assessments will be to determine Agency (SAHPRA), to replace the current Medicines Control Council whether the EMVOEuropean Hub and blueprint systems are designed, (MCC) after legislation progressed through the country’sparliament. managed and operated in accordance with the standards described An amended Medicines and Related Substances bill can nowbe in the Delegated Act on the Unique Identifier,supplementing the forwarded to the National Council of Provinces for approval. G Falsified Medicines Directive,” according to astatement published by the Council of Europe. G

6November 2015 GENERICS bulletin 13 Gen 6-11-15 Pgs. 13-15_Layout 1 04/11/2015 17:41 Page 2

MARKET NEWS

REGULATORY AFFAIRS FTC slams FDA over biologicals suffix plans

roposals outlined by the US Food and Drug Administration (FDA) biologics or dosing errors, or that using such suffixeswould improve Pthat would require biological drugs in the US to carry unique the quality or accuracyofpharmacovigilance efforts. four-letter suffixestotheir international non-proprietary names (INNs) Nevertheless, recognising that the FDAappeared committedto should be reconsidered “in favour of other means to accomplishits such asuffix, the Israeli firm said that if it was“forced to choose purposes that are less likely to hinder competition from biosimilars”, between imperfect alternatives”, licence-holders should have “maximum the US Federal Trade Commission (FTC) has urged. flexibility” to select afour-letter suffix, “whether devoid of meaning The regulator’scomments came during acomment period on the or meaningful”, because each approach had its advantages and draft FDAguideline on ‘non-proprietary naming of biological products’, disadvantages. “Webelieve there is no need for the agencytomandate which wasreleased by the agencyearlier this year (Generics bulletin, a‘one size fits all’ approach to this complexissue,”the firm stated. 11 September 2015, page 1). “Suffixesthat are devoid of meaning can be difficult to remember The FTC said it was“concerned that the FDA’sproposal –to and inherently are subject to the possibility of transcription errors assign different suffixestothe drug substance names of biosimilars throughoutthe distribution chain,”Teva said, while meaningful and their reference biologics –could result in physicians incorrectly suffixes–although “easier to remember” and fostering “better believing that biosimilars’ drug substances differ in clinically-meaningful product understanding” –raised their ownconcerns, “particularly in an ways from their reference biologics’ drug substances, especially since industry undergoing widespread transactional activity,where an differencesindrug substance names have traditionally connoted acquiring companymight seek to alter the non-proprietary name of meaningful differences in drug substances”. an established product’ssuffixinthe middle of aproduct’slifecycle”. “A misperception that the drug substance in abiosimilar differs in clinically-meaningful ways from that in the reference biologic could Distinct names would cause confusion deter physicians from prescribing biosimilars,”the FTC said. Noting Meanwhile, Apotexurged the use of the same INN for biosimilars that originator biologics and biosimilars may compete “less vigorously” and their brand equivalents, as “distinct naming would inject confusion if doctors are reluctant to prescribe biosimilars due to such into the market by creating aperception that biosimilar products have misconceptions,the FTC said perceptions of differentiation “could cause clinically-meaningful differences from the reference listed drug”. price differencestobealess salient feature in the competition between Commenting on the possibility of a“companyspecific” suffix, the products, which would diminish the incentivestoprice aggressively”. Apotexargued that this would “give undue advantage to certain To minimise misperceptions about biosimilars, the FTC said, manufacturers, which defeats the objective of all competitorsstarting “we recommend that the FDAconsider pursuing physician education from alevel playing field”. programmesand testing howprescribers will react to its proposed “Weurgepolicymakers both in the US and globally to avoid the nomenclaturechanges before implementing them”. Moreover, the myriad public health and competitive issues that separate names for regulator warned, distinct suffixeswould lead to “coding and system biosimilars would engender,and embrace the time-tested method of inefficiencies that pharmacists have detailed in their letterstothe FDA”. using INNs to denote the same pharmaceutical substance,”Apotex And because the FDA’sproposals wasinconsistent with aproposal concluded. “Imposing unwarranted requirements for biosimilar or for biologicnaming currently being considered by the World Health interchangeable biosimilars will dampen competition by undermining Organization (WHO), the FTC said, it “risks undermining international public confidence in such products.” harmonisation efforts”. Adopting adifferent stance, Allerganencouraged the FDAto The US Generic Pharmaceutical Association (GPhA) reiterated “assign designated, meaningful suffixesfor interchangeable biological its opposition to the proposals in astatement issued jointly with its products”. This would “promote safe use by preventing inadvertent BiosimilarsCouncil that insisted that “biosimilar products should substitution and support accurate pharmacovigilance”, the firm believes. share the same INN or proper name”. Alifar –the Latin America Pharmaceutical IndustriesAssociation “A newnaming convention with unique INNs will instill –insisted that the FDA’snaming proposal “has no technical or scientific uncertainty, compromise safety and limit ability to improve patient basis and lacks anysanitary justification in terms of public health”. access,”the association stated, adding that unique names “could disrupt “Will adistinctive proper name plus four lettersfor innovator and the current naming system and inhibit market creation for biosimilars”. biosimilarmedicines imply an improvement of the patients’ safety or Moreover, it insisted, the FDAproposal “provides no realistic approach of the traceability or active intensive pharmacovigilance of the for the naming of interchangeable biosmilars”. biosimilar?”, Alifar asked. “Our answer is no.” “Adding asuffixtothe proper name is unnecessary and does not Comments offered by the European Generic and Biosimilar achieve the agency’sstated goals as it will lead to confusion among medicines Association’s(EGA’s)European Biosimilars Group (EBG) prescribers and patients,potentially resulting in medication errors and emphasise that “clear and unique naming for biologic medicines” is best mistranscription in medical records,”the GPhA argued. Identifiers such provided by “the use of aunique brand name or,when this is not as brand names, companynames, lot numbers and national drug code available, by the use of the INN or US Adopted Name (USAN) with the (NDC) numbers already distinguished products from others that shared sponsor’sname”. “The EBG does not agree that arandom suffixoffour acommon INN, the association pointed out, with these unique letters is in anyway superior to these means of identification,”the group identifiers already allowing for adequate tracking and monitoring. stated, insisting that the FDA’sproposal “would introduce major Comments submittedbyTeva urged the FDAtodefer its decision practical difficulties” including being unmemorable and easily misspelt. “to align its final guidance with the eventual WHO standards in order “The EBG is also greatly concerned by the potential for different to facilitate global pharmacovigilance efforts and minimise the proper names of biologics to be used as amechanism to discriminate inefficiencies that would result from adopting US-specific standards against the use of biosimilars,”the group said. “Therefore, if the FDA for products being developed and marketed on aworldwide basis”. continues with its intention to apply suffixestoUSAN names of Teva stated that it did not believe that adding afour-letter suffix biosimilars, we support the simultaneous application of these suffixes wasnecessary to avoid inadvertent substitution of non-interchangeable to USAN names of all approvedbiologics.” G

14 GENERICS bulletin 6November 2015 Gen 6-11-15 Pgs. 13-15_Layout 1 04/11/2015 17:41 Page 3

MARKET NEWS

REGULATORY AFFAIRS REGULATORY AFFAIRS US budget proposals Swedish prescribing arethreat to access must aid substitution

udget proposals in the US that would impose rebates on generics rescribing by international non-proprietary name (INN) should B“will reduce patient access to affordable generics”, according to Pbe allowed in Sweden, the country’sgenerics industry association, the US Generic Pharmaceutical Association (GPhA). FGL, has insisted in response to areport by local medicines agency As part of the ‘Bipartisan Budget Act of 2015’, the US plans to Läkemedelsverkets that has recommended not introducing generic apply an “inflation adjustment to [health insurance programme] prescribing. Currently,Swedish doctors that wish for ageneric to be Medicaid’sgeneric drug inflationary rebate”. Currently,the budget dispensed must specify aparticular generic manufacturer. proposal explains, “single-source and innovator multiple-source drugs Läkemedelsverkets has for some time been considering introducing pay an additional rebate if the price of the drug has increasedfaster generic prescribing in Sweden. The regulator’sfinal report –after a than inflation”. The proposal would also apply this to generics. preliminary version issued earlier this year (Generics bulletin,24 Insisting that the proposal “seeks in part to balance the budget April 2015, page 11) –follows an earlier study,requested by the on the backs of America’s vulnerable Medicaid population”, GPhA country’sgovernment, of the regulatory and infrastructure changes president and chief executive officer Chip Davis said the measures that would be needed for Sweden to introduce generic prescribing “could eviscerate already strained state budgets”. (Generics bulletin,14September 2012, page 13). This was“especially disappointing when there exists an alternative Generic prescribing should “supplement and facilitate, not replace bipartisansolution that would provide billions in savings to the generic substitution”,FGL insists. Questioning Läkemedelsverkets’ healthcaresystem and that would not compromise patient access”, assertion that introducing generic prescribing in Sweden would lead Davis said, urging the US Congress to pass the Fair Access to Safe and to additional costs of SKr200 million (US$23.7 million), the generics Timely (FAST) Generics Act (see page 13). This legislation, Davis industry association’smanaging director,Kenneth Nyblom, said that claimed, would prevent the misuse of Risk Evaluation and Mitigation the cost of updating electronic prescribing systems would be minimal Strategies (REMS) to block generic competition “that costs the US and outweighed by lost savings from acontinuing bar on generic healthcaresystem US$5.4 billion annually and the government US$2.35 prescribing. Moreover, he insisted, the vast majority of both doctors billion”, more than the savings anticipated by the budget deal. G and patients supported generic prescribing. “There is no reason to force the prescriber to choose aprovider IN BRIEF if Läkemedelsverkets considers that drugs are interchangeable,”Nyblom insisted, acknowledging that doctors should still have the option to mark MEB –the Netherlands’ Medicines Evaluation Board –has prescriptions as non-substitutable if required for medical reasons. “completely revised” its policy document on the nomenclatureof Moreover, Nyblom suggested, introducing generic prescribing medicinal products for humans with immediate effect. “Listing of would likely lead to an increasedfocus during doctors’ education on the salt form in the name is no longer mandatory,” while “a generic INNs and substance names rather than brand names or fantasy names. name should always start with the name of the active ingredient”. “Focusing on substance names also facilitates understanding across national boundaries and language barriers,”hepointed out. FDA –the US Food and Drug Administration –has released draft Alternative recommendations noted by Läkemedelsverkets were guidance for comment on what constitutesamanufacturingsite “interesting, butcan be carried out regardless of whether generic change,and what documentation is needed for such achange. prescribing is introduced or not”, Nyblom observed. G

GERMAN hospitals do not take full advantage of the savings potential offered by generic medicines,according to the country’s ACCESS TO MEDICINES generics and biosimilars industry association, Pro Generika. While generic penetration in Germany’soutpatient sector wasaround 76%, the association noted, the figure in the hospitals sector wasjust 54%. MSF lobbiesAfrica and India This compared to 70% in UK hospitals and above 80% in the US. frican governments should work together with India “to maintain Atrade in affordable generic medicines that is alifeline for millions THE EUROPEAN COMMISSION has revised the “certification by a of people in India, Africa and other developing countries”, Médecins qualified person and batch release” annexinits guidelines for good Sans Frontières (MSF) has urged. manufacturing practice for medicinal products for human and The humanitarian group made its comments as African leaders veterinary use. This will come into effect from 15 April 2016. met with Indian prime minister Narendra Modi for an African Union- India meeting in NewDelhi, India. OGD –the Office of Generic Drugs within the US Food and Drug “India is under considerable bilateral pressure from the US and Administration (FDA) –has published amanual of policies and other developed countries to roll back its pro-public-health procedures on consolidation of abbreviated new drug applications intellectual-property policies that have put access to vital life-saving (ANDAs). Applicants with several ANDAs for different strengths generic drugs above the profits of multinational pharmaceutical of adrug may request aconsolidation into one ‘parent’ ANDA. companies,”MSF observed. “India needs to continue its production and supply of lower-cost generics, which are essential for public health.” GLOBAL sales of active pharmaceutical ingredients (APIs) will be African leaders and India must work together “to combat efforts worth US$206 billion by 2020, compared to 2015’sfigure of to undermine the pharmacyofthe developing world”, MSF insisted. US$150 billion, according to areport by Markets &Markets. G “Millions of people in Africa are alive today because of affordable medicines made in India.” G

6November 2015 GENERICS bulletin 15 Gen 6-11-15 Pgs. 16-21_Layout 1 04/11/2015 17:41 Page 2

PRODUCT NEWS

BIOLOGICALDRUGS LITIGATION US originators allyto Unipharmhas remedy informonbiosimilars over Sanofi’s Plavix

iologics originators have joined forces to create aUSgroup to sraeli generics player Unipharm has persuaded aTel Aviv district B“provide unbiased scientific information on the safety and Icourt to award it profits that Sanofigained by unlawfully using a effectiveness of marketed biosimilars and their corresponding novel patent application to deter generic competition to the French biologics” under the banner of the Biologics &Biosimilars Collective originator’s Plavix (clopidogrel bisulphate) blockbuster. Intelligence Consortium (BBCIC). In his ruling, District Judge Ofer Groskopf recognised the Includingamong its supporters AbbVie, Amgen, Anthem, importance of “imposing effective limitations on illegitimate tactics Boehringer Ingelheim and Merck –with other “founding partners” by originator drug companies”.Hefound that Sanofi’sapplication for currently finalising contracts –the BBCIC claims to be “the only apatent covering acrystalline form that lacked novelty had deterred research network dedicated to monitoringbiosimilars”, through a generic competition, thereby constituting an abuse of adominant “science-driven, fully transparent approach which leverages existing position under Israeli antitrust legislation. distributed researchnetwork resources”. Unipharm said the “remarkable and precedential” judgement “Managed care and integrated delivery organisations have devoted “establishes anew set of boundaries on applicants with adominant significant resources to develop an infrastructure that makes possible position in the market”. The generics company’svice-president, Ron active surveillance of biosimilars,”the Consortium says. “The BBCIC Tomer,believesthe decision is “a game-changer in the pharmaceutical marshals these resources for the important public health benefit inherent arena” in that it will deter evergreening tactics by originators. in monitoring biosimilar safety and effectiveness, using ongoing While Sanofi’sIsraeli clopidogrel bisulphate patent expired in sequential analyses to compare biosimilars to their innovator product.” February 2008, the originator effectively deterred competition to Plavix Moreover, the BBCIC insists that its scope “does not include until 15 months later,inMay 2009, as generics firms were worried advocacyorpolitical functions, including taking aposition or about infringing the pending patent for the crystalline polymorph. commenting on legislative or regulatory proposals”. Its 2016 research Unipharm argued successfully that Sanofi’sabandonment of the plan is expected to coverstudies of biosimilars including “G-CSF patent application after generic versions launched supported its assertion agents, insulin glargine and lispro, rituximab, adalimumab, abciximab, that the application was prima facie not patentable for lack of novelty, cetuximab, palivizumab, infliximab and epoetin alfa”. G lack of inventive step and failure to disclose material information. G

ALLERGYDRUGS ANTIRETROVIRALS Teva’s EpiPen rivaldelayed MSF urges action on Kaletra pprovalfor Teva’s US generic alternative to Mylan’sEpiPen outh Africa’sDepartment of Health must act on the “six months A(epinephrine) auto-injector is unlikely to be receivedbefore the Sof persistent supply problems” for AbbVie’slopinavir/ritonavir second half of next year,the Israeli companyhas admitted. (LPV/r) and “override the originator’spatent with acompulsory Siggi Olafsson, Teva’s Generics head, told investors that he licence”, allowing generic versions of the HIV combination treatment to expected the US Food and Drug Administration (FDA) to issue a be used in the country,humanitarian group Médecins Sans Frontières ‘complete responseletter’ when an action date on the firm’sabbreviated (MSF) has urged. newdrug application(ANDA) for asubstitutableversion of the Marketed under the name Aluvia in South Africa –and Kaletra anaphylaxis treatment occurred in December 2015. in the US –LPV/r is a“life-line for nearly 10% of the country’s “Weare not at the point of getting approval,”Olafsson admitted, approximately 3million people on HIV treatment”, MSF noted. But stressing that Teva had received“no negative [FDA] feedback”. G according to stock-out cases reported since April, the majority of patients –65% –were “sent away without medicine”, while the remaining 35% were left with “insufficient supply”. Stock outs BIOLOGICALDRUGS were, moreover, “widespread and acute”, with “about 10% of facilities, mostly large district hospitals, having more than 500 patients per Bio Farma and ProBioGen ally facility being affected”. “Several producers of LPV/r,other than AbbVie, have quality- io Farma and ProBioGen are jointly developing biosimilar assured generic versions of the drug registered in South Africa,”MSF Btrastuzumab for the Indonesian market. Germany’sProBioGen commented, “or have filed for registration of other ritonavir-based will be responsible for the manufacturing process based on “a treatments that the World Health Organization (WHO) suggests could specifically designed recombinant Chinese hamster overy-cell line,” be used as an alternative.”India’sHetero earlier this year struck adeal and will also “conduct engineering runs and industrial scale-up”. to manufacture paediatric formulations of Kaletra in India (Generics The completed process will then be transferred to Indonesia where bulletin,10July 2015, page 20). the state-owned Bio Farma will coordinate with ProBioGen in local Meanwhile, insisted Catherine Tomlinson of MSF’sAccess market production. ProBioGen will receive apayment for services but Campaign in the country,alternative suppliers of LPV/r “could have the agreement is licence- and royalty-free. Wieland Wolf, ProBioGen’s been on the market years ago”. “If South Africa examined patent chief executive officer,said: “This is the first trastuzumab molecule applications, LPV/r might not have been granted multiple patents for which will be produced locally for the Indonesian market to provide aprolongedpatent monopoly,” she said, adding that the process for effective modern medicines for acountry of 250 million people.” G issuing compulsory licences needed to be “less onerous”. G

16 GENERICS bulletin 6November 2015 Gen 6-11-15 Pgs. 16-21_Layout 1 04/11/2015 17:41 Page 3

PRODUCT NEWS

BIOLOGICALDRUGS RESPIRATORY DRUGS Turkey’s Turgut Ilac Glenmark teams up to work with Merck for EU Seretide rival

urkish biosimilars firm Turgut Ilac has signed amulti-year lenmark says it has taken a“significant step towards building a Tbiosimilars development and manufacturing agreement with Gstrong respiratory franchise in Europe” by signing adevelopment Merck KGaA’s US-based EMD Millipore life sciences business. and licensing agreement with Polish firm Celon Pharma covering a Under the agreement –for which financial terms were not disclosed generic rivaltoGlaxoSmithKline’s(GSK’s) Seretide Accuhaler –the German firm will provide via its Provantage End-to-End Solution (fluticasone/salmeterol)dry-powder inhaler (DPI) in certain European services, “process development, current good manufacturing practice countries. Struck for an initial 10-year period, the distribution (cGMP) manufacturing, facility design and technology transfer of the agreement includes an option for atwo-year extension. manufacturing process to Turgut’sfacility for commercial production”. Under the agreement, the Indian firm will gain “semi-exclusive” “Phase one of the agreement will focus on monoclonal antibody marketing and distribution rights for the asthma and chronic obstructive biosimilars for non-small cell lung carcinomaand rheumatoidarthritis,” pulmonary disease (COPD) treatment across 15 European markets, revealed Merck, adding that it would also provide the Turkish firm including Germanyand the UK, as well as Belgium, Italy,the with equipment for pilot-plant production, process and equipment Netherlands, Norway,Romania and Sweden. Celon will receive an training and equipment qualification. upfront payment from Glenmark, as well as milestone payments “Wesought aprovider with strong scientific knowledge and during “various stages” of product development and royalties. expertise that could provide turnkey support encompassing everything from process development to commercial production,”said Turgut’s Adds to Salmecortinhaler chairman, Kaya Turgut. Glenmark’srespiratory portfolio currently includes its Salmecort Based in Istanbul, Turgut “was one of the first generic (fluticasone/salmeterol) pressurisedmetered-dose inhaler (pMDI), pharmaceutical companies to emerge in Turkey in 1951”, and 12 years which the Indian firm earlier this year introduced in Russia (Generics ago sold its small-molecule generics business to Actavis. The Turkish bulletin,27March 2015, page 15), having also rolled it out in other player’sbiotechnology group wasestablished in January last year, European markets, as well as in Mexico and the Philippines. “aiming to develop aresearch and development based biotechnology Commenting on the agreement,Maciej Wieczorek, Celon’s infrastructure in Turkey”producingboth for local and global markets. G chief executive officer,said that the “common experiences of both companies in the area of manufacturing, commercialisation and distribution of inhaled drugs will translateinto greater availability of combination therapyinaDPI inhaler in manyEuropean countries”. SPECIAL LICENSING Earlier this year,the Polish firm inked an agreement with another OPPORTUNITIES Indian firm, Lupin, to jointly develop ageneric version of GSK’s brand in the US –where it is sold under the Advair Diskus name –as well as in Canada, Mexico and “other keymarkets”. G DOSSIERS AVAILABLE Betahistine tablets –8, 16 and 24mg ONCOLOGY DRUGS Cyanocobalamin UK rejects paclitaxel SPCs tablets –1mg Paracetamol/Codeine wo supplementary protection certificate (SPC) applications for Taxol tablets, several strengths –from 500/8mg up to T(paclitaxel) based on the UK part of European patent 2,226,085 have been rejectedbythe UK’sIntellectual Property Office (IPO). 1,000/60mg Filed on behalf of Angiotech Pharmaceuticals, the SPC Tranexamic acid applications –SPC/GB/14/030 and SPC/GB/14/031 –concerned using film-coated tablets –250, 500, 750 and 1,000mg paclitaxel and paclitaxel with adrug-elutingstent (DES) to treat or DOSSIERS AVAILABLE SOON prevent restenosis, where an artery or valverenarrows after corrective surgery.The ‘085 patent expired in July last year. Acetylsalicylic Acid According to Angiotech’sagent and filer Forresters, the procedure enteric-coated tablets –50, 75, 100 and 160mg for obtainingapprovalfor aSPC “under directive 93/42/EEC” –which Loperamide ODT concerns medical devices –is“sufficiently identical” to the procedure orally disintegrating tablet –2mg under directive 2001/83/EC for the approvalofamedicinal product for human use, and, “as such, can be used in support of an SPC Tramadol application” under the SPC regulation. hard capsules –50 and 100mg But IPO hearing officer Lawrence Cullen wasnot convinced, Warfarin noting that the “objectivesofboth [directive] systems are different film-coated tablets –2.5mg giventhe differing uses of medicinal products and medical devices Other opportunities available at www.neogen.be and the different means used to approve their use in humans”. “I do not consider that the products for which the twoSPC applications have For more information please contact been applied for…have been subject to an administrative procedure [email protected] as laid down in Directive 2001/83/EC,”heconcluded. G

6November 2015 GENERICS bulletin 17 Gen 6-11-15 Pgs. 16-21_Layout 1 04/11/2015 17:41 Page 4

PRODUCT NEWS

BIOLOGICALDRUGS IN BRIEF AUROBINDO will begin marketing tramadol hydrochloride 100mg, Pfizer must respond 200mg and 300mg extended-release tablets in US by the first quarter of 2016. The companyjoins Lupin, Parand Sun in receiving final approvalfrom the US Food and Drug Administration (FDA) for a generic rivaltoValeant’s Ultram ER.The estimated annual market on US Retacrit letter size for the analgesic is US$56 million, according to IMS data.

fizer intends to respond during the first half of next year to a EMA –the European Medicines Agency–has advised that pregnant Pcomplete response letter the companyreceivedon16October for women should not take mycophenolate mofetil “unless no suitable the Retacrit (epoetin) biologics license application (BLA) submitted alternative is available to prevent transplant rejection”. While the to the US Food and Drug Administration (FDA) by its Hospira unit. agencyhas approvedthe immunosuppressant centrallyunder the The US-based originator has also returned to Celltrion rights that CellCept brand and as generics from Herbert Passauer and Teva, Hospira had previously acquired to potential biosimilars to Herceptin several European national authorisations for generics also exist. (trastuzumab)and Rituxan (rituximab). John Young, head of Pfizer’sGlobal Established Products business, FDA –The US Food and Drug Administration –has found that said the firm wascurrently reviewing the concerns on epoetin outlined Comtan (entacapone)and Stalevo (entacapone/carbidopa/ in the FDA’sletter and preparing its responses. “Our initial assessment levodopa)donot increase risk of heart attacks, strokeorother indicates no additional clinical studies are required at this point,”he cardiovascular events. The FDAoriginally warned patients and stated, adding that once Pfizer had responded during the first six healthcareprofessionals about apossible increasedrisk for months of 2016, it expected asix-month FDAreviewunder the terms cardiovascular events and death with entacapone in August 2010, of the US Biosimilars User Fee Amendments (BsUFA). butafter examining twostudies, theyfound no increasedrisk. Pfizer said returning the rituximab and trastuzumab rights to Celltrion would “eliminate certainredundancies in Pfizer’sbiosimilar SANDOZ’ Glatopa (glatirameracetate)isequivalent to Teva’s drug products pipeline created as aresult of the acquisition of Hospira”. Copaxone,according to twoarticles published in the Journal of Pfizer is already conducting Phase III clinical trials for its own Neurological Sciences and Plos One respectively.Glatopa has already PF-05280586 rituximab and PF-05280014 trastuzumab candidates. been determinedbythe US Food and Drug Administration (FDA) In July this year,Pfizer begandosing patients in amultinational to be atherapeutically equivalent product to Copaxone and fully Phase III trial for its PF-06410293 biosimilar of Humira (adalimumab). substitutable (Generics bulletin,24April 2015, page 1). The study will compare in rheumatoid arthritis patients the efficacy, safety and immunogenicity of the biosimilar versus Humira sourced LUPIN has launched its generic version of Fresenius’ PhosLo in the European Union (EU). G Gelcaps,(calcium acetate)667mg capsules after receiving final approvalfrom the US Food and Drug Administration (FDA). PhosLo Gelcaps had annual sales of US$54.5 million as of March 2015, according to IMS Health. BIOLOGICALDRUGS GPhA queries reimbursement CIRCASSIA says it has begun clinical development of its fixed-dose triple combination chronic obstructive pulmonary disease (COPD) eimbursement rules for biosimilars announced by the US Centers treatment “which contains particle-engineered formulations of Rfor Medicare &Medicaid Services (CMS) are “likely to discourage fluticasonepropionate, glycopyrronium bromide and salmeterol investment in biosimilar therapies, making it harder for patients to xinafoate administered via pressurised metered-dose inhaler”. access these newproducts in the US”, according to US Generic Recruitment has been completed for asingle-dose component of Pharmaceutical Association (GPhA) president and chief executive atrial in Berlin, Germany, from which results are expected in the officer Chip Davis. CMS said it had finalised its regulations to “clarify second quarter of 2016. Earlier this year the firm boughtUK-based that the payment amount for abiosimilar biological product is based respiratory specialist Prosonix in a£100 million (US$155 million) on the average sales price of all biosimilar biological products included deal (Generics bulletin,22May 2015, page 23). within the same billing and payment code”. “The Biosimilars Council, adivision of the GPhA, is disappointed ENDO and development partner BioDelivery Sciences expect to by the CMS decision to group all biosimilars together under one introduce their Belbuca (buprenorphine)buccal film original in the payment calculation and billing code in MedicarePart B, while using US in the first quarter of next year following US Food and Drug adifferent code for the reference product,”Davis noted. “It is Administration (FDA) approvalfor the chronic pain treatment in unfortunate that CMS chose to ignore the strong reservations expressed sevenstrengths. Having seen the firms’ newdrug application(NDA) by experts from all corners of the supply chain, leading biosimilar accepted for filing at the beginning of the year (Generics bulletin, manufacturers and others.” 27 February 2015, page 27), RajivDeSilva, Endo’spresident and Bert Liang, chief executive officer of Pfenexand chairmanofthe chief executive officer,described the approvalasan“important Biosimilars Council, said there was“no scientific evidence that suggests and meaningful milestone” for the company. it would be appropriate to blend all biosimilar products into asingle payment calculation, independent of the reference product”. PAR’s patent-infringement litigation with Horizon Pharma overthe “While we appreciate CMS’ recognition that it would be premature generics firm’sabbreviated newdrug application(ANDA) for arival to issue arule regarding reimbursement for future interchangeable to Ravicti (glycerol phenylbutyrate)has taken astep forward after a biosimilars, placing all non-interchangeable products in asingle code Texas district court issued a‘Markman’ claim-construction ruling on independent of the reference product is still misguided,”Liang said. US patents 8,404,215 and 8,642,012. The originator noted that the “Non-interchangeable products are solely compared to the reference ruling had “adopted Horizon’sproposed construction of all butone product, and not one another,” he pointed out, “making this of the disputed claim terms”. G arrangement highly unusual.” G

18 GENERICS bulletin 6November 2015 Gen 6-11-15 Pgs. 16-21_Layout 1 04/11/2015 17:41 Page 5

PRODUCT NEWS

BIOLOGICALDRUGS RESPIRATORY DRUGS Lilly is launchingits Teva defeats AZ in Abasaglar in Europe Dutch DuoResp duel

li Lilly says it is “in full launch mode” for rolling out its Abasaglar eva has claimed victory overAstraZeneca in aDutch battle over E(insulin glargine) biosimilar rivaltoSanofi’sLantus diabetes Tthe Israeli firm’sDuoResp Spiromax (budesonide/formoterol). blockbuster in Europe. Having reached aglobal patent-litigation The dispute revolved around a‘descriptive seizure’ –oraseizing of settlement with the French group, Lilly and its partner Boehringer evidence –byAstraZeneca of information relating to the drug as part Ingelheim have followed the initial launches of Abasaglarinthe Czech of litigation overthe respiratory treatment. Republic and Slovakia by introducing the biosimilarinGermany, AstraZeneca had as part of an earlier dispute overalleged Poland, Sweden and the UK. infringement of its European patent EP1,085,877 agreed with Teva Enrique Conterno, president of Lilly Diabetes, said Abasaglar had terms under which the originator would give five weeks’ notice to captured 3% of the Czech market for basal insulin analogues, while Teva before conducting such aseizure. However, as part of asubsequent its market share in Slovakia was11%. “It is likely that in Slovakia some attack on DuoResp relating to aseparate European patent, EP1,289,506, of the [Abasaglar]patients are switches, because the reimbursement AstraZeneca did not give prior notice. levelinSlovakia waslowered when we launched,”hecommented, Apreliminary decision by aNorth Netherlands district court found noting that patients using Lantus were nowrequired to pay out-of-pocket that Teva should have receivedthe prior notice before the seizure. for the difference from the original’sprice to the reimbursement level. Ordering AstraZeneca to return the seized records and files to Teva, the court imposed afine of C10,000 (US$11,000) for each hour that Captured 5.5% of Japan’s market the originator failed to comply with the order,uptoamaximum of In Japan, Conterno revealed, the biosimilar had captured 5.5% C2million. The court also awarded Teva costs of C20,000. G of the local market for basal insulin analogues within twomonths of market entry.“So far, our launches are going well,”hesummarised. “Uptakeisvery good, maybe slightly ahead of our expectations.” HEPATITIS CDRUGS Under the terms of the global litigation settlement, Sanofigranted Lilly aroyalty-bearing licence that allows Lilly to makeand sell its Natco extends Nepalese range biosimilarinsulin glargine globally in its KwikPen delivery device. The deal also permits Lilly to launch the drug under the Basaglar atco Pharma is claiming the launch of the “first generic version” brand name in the US from 15 December 2016 (Generics bulletin, Nof Gilead’sHarvoni (sofosbuvir/ledipasvir) 400mg/90mg tablets 23 October 2015, page 25). G in Nepal. Launched under the fantasy name Hepcinat LP,the fixed- dose combination chronic hepatitis Ctreatment had been introduced with amaximum retail price of Rs25,000 (US$384) for a28-count bottle, the Indian firm noted. Natco’slaunch comes pursuant to alicensing agreement it had reached with the US originatorearlier this year covering generic alternativestoSovaldi (sofosbuvir), sofosbuvir/ledipasvir and sofosbuvir in combination with an under-development compound, in India and 100 other developing countries” (Generics bulletin,27March 2015, page 21). The firm at that time beganshipping its generic sofosbuvir tablets in Nepal under the Hepcinat name. Last year anumber of firms –including Cipla, Hetero, Mylan, Sequent Scientific, Strides Arcolab, Sun’sRanbaxy and Zydus Cadila – inked alicensing agreement with Gilead covering sofosbuvir and sofosbuvir/ledipasvir in 91 developing countries (Generics bulletin, 3October 2014, page 19). G

BIOLOGICALDRUGS Boehringer targets Humira oehringer Ingelheim says its biosimilarversion of adalimumab Bhas demonstrated pharmacokinetic bioequivalence and safety similarity to AbbVie’sHumira in aPhase Itrial. The trial –which involved the US-licensed and European Union approvedreference products –was arandomised, double-blind, single-dose, parallel-arm study in 327 healthymales between the ages 18 and 55. Each participant wasrandomised to receive one subcutaneous 40mg/0.8ml dose of either Boehringer’sBI695501biosimilar candidate, the US-licensed original or EU-approvedHumira. “Safety,tolerability and immunogenicity were comparable,”the German firm stated. G

6November 2015 GENERICS bulletin 19 Gen 6-11-15 Pgs. 16-21_Layout 1 04/11/2015 17:41 Page 6

PARAGRAPH IV WATCH Rivaroxaban rivalsmay varyonapproach

aragraph IV patent challenges have become aroutine aspect of Pgeneric drug development for the US market. In the current KEY DETAILS: XARELTO competitive landscape, innovators must expect challenges, even when Brand: Xarelto their intellectual-property portfolio seems solid. “It often appears that commercial considerations drive the generic challenges, rather than Active ingredient: rivaroxaban obvious patent weakness,”observes Thomson Reuters, which maintains Delivery form: 10mg, 15mg and 20mg tablets adatabase of paragraph IV challenges and associated litigation. Brand owners: Bayer and Janssen That is not to say that such challenges are without merit, butthat US brand sales: US$1.37 billion in first nine months of 2015 whateverarguments for patent invalidity or non-infringementmay be offered are developed in the service of an obvious commercial interest. First paragraph IV 1July 2015 After identifying acommercially attractivetarget, companies may filing submitted to FDA: develop differing strategies to address the innovator’spatents. Those differencesmay prove to be significant. The challenges to Bayer and Known paragraph IV Aurobindo, Breckenridge, Micro Labs, Janssen’sblood thinner Xarelto seem to raise this as apossibility. filers: Mylan, Prinston, Sigmapharm and Some branded products attract paragraph IV challenges likemoths Torrent to aflame. Xarelto is one such product, with billions of dollars in US sales, an oral-solid formulation, and awidely available active Orange Book patents: 7,157,456 –8February 2021* ingredient. The US Food and Drug Administration (FDA) reports more 7,585,860 –11December 2020 than 15 different companies submitted drug master files (DMFs) for 7,592,339 –11December 2020 rivaroxaban before the first abbreviated newdrug application(ANDA) District court locations: Delaware for ageneric version of the anticoagulant wassubmitted, asure sign of great generic appeal. Litigation references: Bayer Intellectual Property GmbH et al. In addition,Xarelto tablets are subject to aNew Chemical Entity vs Aurobindo Pharma Limited et al. (NCE) exclusivity.Products subject to afive-year NCE are protected 1:15-cv-00902 from challenge for four years from the date of first approval. This *Aterminal disclaimer has been filed to change means that potential challengers knowthe specific date upon which an the expiration date to 11 December 2020 ANDAmay be submitted in order to secure first-filer status and the potential eligibility for the valuable 180-day generic market exclusivity Figure1:Paragraph IV challenges to Bayer and Janssen’s Xarelto (rivaroxaban) it brings. This date, the so-called NCE -1 date, is exactly one year tablets in the US (Source –Thomson Reuters) before the expiration of the NCE exclusivity.Itshould come as no Active Brand Earliest ANDA surprise then that the FDAreports the first ANDAfor ageneric version ingredient name submission date of Xarelto tablets wassubmitted on 1July 2015, exactly one year before the expiration of the NCE for rivaroxaban. Deferiprone Ferriprox 14 October 2015 Clobazam Onfi21October 2015 Suits filed against seven challengers Ruxolitinib phosphate Jakafi16November 2015 On 9October 2015, Bayer and Janssen filed apatent-infringement Ingenol mebutate Picato 23 January 2016 suit against Aurobindo, Breckenridge, Micro Labs, Mylan, Prinston, Axitinib Inlyta 27 January 2016 Sigmapharm, and Torrent in aDelaware district court in responseto Vismodegib Erivedge 30 January 2016 their ANDAs for generic versions of Xarelto tablets (see Figure 1). “One can reasonably assume that all sevencompanies filed Ivacaftor Kalydeco 31 January 2016 their ANDAs on the NCE -1 date. If all succeed with their patent Tafluprost Zioptan 10 February 2016 challenges, theywill share eligibility for the 180-day exclusivity,” PancrelipaseUltresa, Viokase 1March 2016 notes Thomson Reuters. Bayer and Janssen did not, however, assert the same patents Figure2:Active ingredients subject to new chemical entity (NCE) exclusivities for which abbreviated new drug applications (ANDAs) can be submitted between against each ANDAfiler.While most of the ANDAfilers were sued October 2015 and March 2016 (Source –Thomson Reuters) for infringementofall three listed patents, the plaintiffs asserted only US patents 7,157,456 and 7,585,860 against Breckenridge, and only scenario in which afiler could gain early access to the market that US patent 7,157,456 against Micro Labs. is denied to the others. In the case of ablockbuster likeXarelto, that “Since all of the Xarelto patents will expire on the same date, one could be avery significant difference.” might assume that the Breckenridge and Micro Labs ANDAs do not As can be seen from Figure 2, NCE -1 dates for ApoPharma’s infringe the patent or patents that Bayer and Janssen did not assert Ferriprox (deferiprone) iron chelator and Lundeck’sOnfi(clobazam) against them. That may be significant if the other filers are unable to seizures treatment recently arrived, opening the door for ANDA establish the invalidity or non-infringement of those patents,”comments submissions that include paragraph IV patent challenges. Incyte’s Thomson Reuters. “Under those circumstances, one can imagine a Jakafi(ruxolitinib) tablets could come under attack this month. G

Thomson Reuters draws on strategic intelligence and competitive analysis information on the US generics industry to create Newport Premium™,the criticalproduct-targeting and global business-development system from the industry authority on the global generics market. Forfurther details contact Benjamin Burck, Thomson Reuters API Intelligence, 215 Commercial Street, Portland, Maine 04101, USA. Tel: +1 207 808 7977. Fax: +1 207 871 9800. E-mail: [email protected]. Website: scientific.thomsonreuters.com/newport.

20 GENERICS bulletin 6November 2015 Gen 6-11-15 Pgs. 16-21_Layout 1 04/11/2015 17:41 Page 7

PRODUCT NEWS

IN BRIEF BIOLOGICALDRUGS MYLAN is launching arivaltoSpectrum’s Fusilev (levoleucovorin calcium)10mg/mL, 175mg/17.5mL and 250mg/25mL single-use Celltrion has success vials for injection in the US following US Food and Drug Administration (FDA) approval. Mylan’sgeneric enters into amarket that also includes Sandoz, which receivedapprovalfor its generic in May (Generics bulletin,8May 2015, page 18). US sales for the switching infliximab single-use vials were approximately US$200 million for the year ended 30 June 2015, according to IMS Health. hree separate trials have shown clinical similarity between Celltrion’s TRemsima (infliximab) biosimilar and Janssen’sRemicade, including DR REDDY’S has emphasised its “strategic intent of being aplayer for both naïvepatients and those switched from the original brand, of substance in the Indian OTCspace” by launching Nise DSpray, according to details published by the South Korean firm. an analgesic comprising “three keyingredients” to soothe pain and Arecent Czech trial demonstrated “no differences in efficacy, reduce inflammation.The firm already markets aNise gel. adverse events and immunogenicity when patients with inflammatory bowel disease (IBD) are switched to biosimilarinfliximabRemsima IMPAX is considering whether to launch into the US guanfacine from originatorinfliximab, the reference medicinal product (RMP),” market following arecent US Food and Drug Administration (FDA) Celltrion noted. The trial involved 74 patients with IBD who were on approvalfor its generic version of guanfacine extended-release 1mg, long-term treatment with Remicade and were switched to Remsima. 2mg, 3mg and 4mg tablets, which had been delayed due to an FDA The trial followed up after amedian of 24 weeks and found the same warning letter at the firm’sHayward site. Rivals to Shire’s Intuniv maintenance of remission, with minimal adverse events and no already include versions launched by Actavis, Mylan, Sandoz, Teva difference in allergic reactions. and TWi(Generics bulletin,26June 2015, page 18). Fred Wilkinson, Commenting on the trial, Milan Lukas, head of the IBD president and chief executive officer of Impax, said the company department at the ISCARE clinic in Prague, the Czech Republic, said: was“evaluating the viability of this very competitive multi-player “Wehavefound biosimilarinfliximab to be comparable to the originator market and potential commercialisation.”Annual US brand and in both switch and anti-TNF naïvepatients, and are encouraged that generic sales were around US$689 million according to IMS. others around the world are having similar experiences.” Asimilar real-world study of IBD patients in South Korea CAPSUGEL has commercially launched its enTRinsic drug-delivery involving 173 patients –which included treatment-naïvepatients and technology platform. “This first-of-its-kindinnovation provides full patients who had been treated with Remicade –showed “that Remsima enteric protection and targeted release of gastric acid- and heat- is well tolerated and efficacious in IBD patients”, Celltrion reported. sensitive active ingredients to the upper gastrointestinal tract, without Comparison of the study with historicaldata for Remicade found that the need for functional coatings,”the firm stated. “safety and efficacyare comparable for Remsima”. Clinical efficacyofRemsima wasalso demonstrated by an SUN PHARMA will be allowed to market in the US ageneric version additional study in the Czech Republic with 93 patients, which found of Ampyra (dalfampridine)extended-release tablets from “a the efficacyresults “comparable to aretrospective cohort of RMP”. specified date in 2027, or potentially earlier under certain “Biosimilar infliximab can support greater and earlier access to circumstances” after reaching alitigation settlement agreement with biological therapieswhile reducing the financial burden on healthcare brand owner Acorda. This follows asimilar deal between Actavis systems around the world,”noted StanleyHong, president and chief and Acorda (Generics bulletin,23October 2015, page 29). executive officer of the South Korean firm’smarketing and distribution division, Celltrion Healthcare. “Switching to biosimilars offers MERCK’s global sales of Remicade (infliximab)fell by 27% to comparable clinical benefits at alower price, allowing medical US$442 million in the third quarter of 2015. The lower sales were communities to realise higher cost-savings.” G put down “to loss of exclusivity in the company’smarketing territories in Europe” as the firm faced biosimilar competition. ANALGESICS/ONCOLOGY DRUGS OTSUKA has filed acomplaint against the US Food and Drug Administration (FDA) in aColumbia district court attacking the Actavis settles on US Abstral agency’sapprovalofAlkermes’ 505(b)(2) hybrid application for Aristada (aripiprazolelauroxil)long-acting injectableatthe start llergan’sActavis has obtained the right to launch US rivals to of October.Insisting that the approvalviolated exclusivity rights for AOrexo’sAbstral (fentanyl citrate) sublingual tablets overayear Otsuka’sown long-acting injectable aripiprazole, Abilify Maintena, before patent expiry under the terms of asettlement agreement that Otsuka said Alkermes had used the 505(b)(2) pathway as a“short-cut” resolves all pending litigation related to Actavis’ abbreviated new that allowed it to “obtain aHatch-Waxman benefit” of referencing drug application (ANDA). aripiprazole “but to not be subject to the corresponding Hatch- Having sent aparagraph IV notification to the Sweden-based Waxman trade-off” of aripiprazole’sexclusivity. originator and its partner and newdrug application(NDA) holder Galena Biopharma at the beginning of this year (Generics bulletin, FTC –the US Federal Trade Commission –has been urged by a 27 February 2015, page 22), Actavis is under the settlement “allowed bipartisan group of US Senators to “investigate possible illegal to enter the market in June 2018, or earlier under certain circumstances”. collusion by saline solution manufacturers”. The Senators noted the Three US patents –6,759,059, 6,761,910 and 7,910,132 –currently country’s“shortage of saline solution since 2013 and the failure of shield the treatment for breakthrough pain in cancer patients until the three companies that provide all of the saline solution in the US 24 September 2019. to end the shortage”. The firms cited in the Senators’ letter to the A30-month stay of approvalrelating to aseparate Actavis FTC are Baxter,BBraun and Hospira. “Suppliers are reported to have paragraph IV certification challenging patents listed against another increased their prices by 200%-300%,”the letter states. G of Orexo’soriginals, Zubsolv (buprenorphine/ naloxone) sublingual tablets, will expire next year. G

6November 2015 GENERICS bulletin 21 Gen 6-11-15 Pg. 22_Layout 1 04/11/2015 17:42 Page 2

EVENTS

NOVEMBER FEBRUARY IMS Health, and Thornton &Ross and a networking drinks reception and dinner. 23-24 November 10-11 February Contact:OTCToolbox. ■ EuroPLX 59 ■ World Generic Medicines Tel: +44 (0)121 314 8757. Athens,Greece Congress Europe 2016 E-mail: [email protected]. Website: plg-group.com/events/ This meeting provides aforum for Barcelona, Spain bdconsumerhealthcareotc/ business-development decision-makers Topics covered at this two-day event will to discuss and negotiate agreements, in- include growth opportunities of complex 8-9March licensing, marketing and distribution of generics, legaland regulatory developments ■ 12th EGA Legal Affairs patented medicines, generics, biosimilars, and current market trends and future OTCproducts, medical devices and challenges for biosimilar success. There Conference food supplements. will be roundtable discussions and Brussels,Belgium Contact:Raucon. networking opportunities. This two-day EGA conference will cover Tel: +49 6221 426296 0. Contact:Health Network Communications. issues including the latest legaland E-mail: [email protected]. Tel: +44 207 092 1210. intellectual-property developments Website: europlx.com. E-mail: customerservices@healthnetwork regarding generic and biosimilar medicines. communications.com. Contact:Lucia Romagnoli. JANUARY Website: www.healthnetworkcommunications.com. Tel: +44 7562 876 873. E-mail: [email protected]. 27 January 22-24 February Register onlineat www.egaevents.org/laf/egalaf2016reg. ■ 9th EGA Pharmacovigilance ■ GPhA 2016 Annual Meeting Florida, USA Conference 8-10 June London, UK This is athree-day conference organised ■ Joint 22nd EGA and This European Generic and Biosimilar by the US Generic Pharmaceutical medicines Association (EGA) conference will Association (GPhA). It will look at 19th IGBA Annual look at topics including pharmacovigilance regulatory issues and opportunities for the Conference legislation, risk management and biologics. US generics industry. Dubrovnik, Croatia Contact:Lucia Romagnoli. Contact:GPhA. For2016, the European Generic and Tel: +44 7562 876 873. Tel: +1 202 249 7100. Biosimilar medicines Association (EGA) E-mail: [email protected]. E-mail: [email protected]. and the International Generic and Website: gphaonline.org. Register onlineat Biosimilar Medicines Association (IGBA) www.egaevents.org/egaphvrac2016reg. will join forces for their annual MARCH conferences. The IGBAconsists of 28-29 January 3-4March industry associations representing Canada, Europe, Japan, Jordan, South ■ 15th EGA Regulatory& ■ Business Development& Africa, Taiwan and the US. Scientific Affairs Conference Innovation Opportunities in London, UK Consumer Healthcare/OTC Contact:Lucia Romagnoli. This two-day conference will provide updates Tel: +44 7562 876 873. London, UK E-mail: [email protected]. on regulatory developments. The event will Organised jointly by the Pharmaceutical Register onlineatwww.egagenerics.com followthe EGA Pharmacovigilance or www.egaevents.org. Conference at the same venue in London. Licensing Group and OTCToolbox, this conference and networking event will focus Contact:Lucia Romagnoli. Tel: +44 7562 876 873. exclusively on business development and SAVE THE DATE E-mail: [email protected]. innovation in the consumer healthcare/OTC Tu esday market. There will be industry speakers from 4October 2016 Register onlineat Barcelona, Spain. www.egaevents.org/egaphvrac2016reg. firms includingBoehringer Ingelheim,

Allthat’shappening in consumer healthcare Individual subscription rates WrittenbyOTC specialists from an OTCindustryperspective startfrom just £975 The best decision-makers in the OTC industry don’t have the time to go looking for good information. They let it come to them. They subscribe to OTC bulletin. Join thousands of subscribers from competitor companies in over 35 countries who are already benefitting from commercial intelligence about businessopportunities in the global non-prescription medicines and dietary supplements markets. NEW AVAILABLEINSTANTLYWORLDWIDE OTC bulletin-i is the digital i-edition of OTC bulletin.Now available online for desktop access, it delivers the latest OTC bulletin on the day of publication withnopostal delay.It alsocomes –at NO EXTRACHARGE –asanapp for mobile access by tablet and smartphone. OTC bulletin-i subscribers also get access to afully-searchable archive.This contains over five years of OTCnewsand analysisinmore than 100 back issues. Take outasubscription TODAYatwww.OTC-bulletin.com or contact: [email protected]

22 GENERICS bulletin 6November 2015 Gen 6-11-15 Pg. 23_Layout 1 04/11/2015 17:43 Page 3

PRICE WATCH ...... UK Prices experience sharp swings in October opular generics launched since 2012 experienced some dramatic margin. The other price falls told asimilar tale, while the lowest price Pprice falls during October,with aripiprazole, celecoxib, cilostazol of celecoxib 200mg dropped to little more than £0.02 per capsule. and eplerenone leading the way. Both the average and lowest trade Meanwhile, three ingredients –lercanidipine, penicillamine and prices of these relative newcomers to category Mofthe Drug Tariffof procyclidine –dominated products with the fastest monthly price rises pharmacyreimbursement prices lost ground by double-digit amounts (see Figure 2). Lercanidipine and procyclidine were also to be found last month (see Figure 1). in the list of price concessions granted by the Department of Health for Aripiprazole prices have been falling steadily for the past few October because their market prices exceeded those in the Drug Tariff. months (Generics bulletin,11September 2015, page 23), butthe latest Packs containing 28 tablets of lercanidipine 20mg were givenaprice declines were sharp, even by recent standards. The lowest price to concession of £9.85; while those with 28 procyclidine 5mg tablets could independent pharmacists and dispensing doctors of 28-tablet packs be reimbursed at £14.00. Drug Tariffreimbursement prices for 56-tablet of aripiprazole 10mg dropped by almost half in October to £6.75 packs of penicillamine 125mg and 250mg were £11.20 and £26.57, (US$10.30). This compared with atrade price for Otsuka’sAbilify of both considerablyless than their actual average trade prices. £96.04, and represented a93% discount to the brand. Pharmacists Metoprolol wasamong the products with the biggest monthly benefitted from awhopping dispensing margin of 85% on the product’s price falls (see Figure 3), and omeprazole continued to dominate the Drug Tariffprice of £43.81. Even the average price yielded a54% fastest-moving products (see Figure 4). G

RECENT LAUNCHES BIGGEST RISERS Product/Strength/Pack size Lowest Change Average Change Product/Strength/Pack size Lowest Change Average Change price (%) price (%) price (%) price (%) Amorolfine lacquer 5% 5ml £4.08 +3 £6.29 +1 Procyclidine tabs 5mg 28 £0.85 +5 £9.55 +572 Aripiprazole tabs 10mg 28 £6.75 -42 £20.23 -21 Procyclidine tabs 5mg 500 £16.50 +25 £109.96 +455 Atorvastatin tabs 20mg 28 £0.48 +12 £0.81 +1 Penicillamine tabs 125mg 56 £6.30 +4 £19.42 +106 Candesartan tabs 8mg 28 £0.37 -3 £0.62 -6 Lercanidipine tabs 10mg 28 £0.59 +16 £1.58 +79 Celecoxib caps 200mg 30 £0.69 -19 £1.66 -21 Penicillamine tabs 250mg 56 £19.90 +30 £36.37 +69 Cilostazol tabs 100mg 56 £2.63 -34 £6.58 -16 Lercanidipine tabs 20mg 28 £0.80 +3 £2.13 +57 Cyclizine tabs 50mg 100 £6.80 -6 £9.16 -6 Desogestrel tabs 75µg 84 £1.35 -2 £2.57 -6 BIGGEST FALLERS Duloxetine E/C caps 30mg 28 £9.10 -9 £14.31 -7 Product/Strength/Pack size Lowest Change Average Change Entacapone tabs 200mg 30 £3.82 -5 £5.12 ±0 price (%) price (%) Eplerenone tabs 25mg 28 £11.00 -27 £22.28 -16 Escitalopram tabs 10mg 28 £0.18 -31 £0.77 -11 Tizanidine tabs 4mg 120 £2.89 -20 £6.17 -55 Hydroxychloroquine tabs 200mg 60£2.74 -2 £3.63 -6 Metoprolol tabs 50mg 56 £1.25 -1 £2.60 -43 Irbesartan tabs 75mg 28 £0.33 -6 £0.69 -6 Metoprolol tabs 50mg 28 £0.71 ±0 £1.28 -41 Memantine tabs 10mg 28 £0.30 -43 £1.19 -9 Famciclovir tabs 500mg 14 £9.45 -45 £50.10 -36 Montelukast tabs 10mg 28 £0.79 -11 £1.47 ±0 Galantamine MR caps 8mg 28 £2.45 +4 £5.40 -32 Oxcarbazepine tabs 300mg 50 £5.09 -1 £10.41 -6 Isosorbidetabs 60mg 28 £1.35 ±0 £4.29 -28 Rabeprazole tabs 10mg 28 £0.94 -14 £1.54 -3 Raloxifene tabs 60mg 28 £2.80 -4 £4.55 -6 FAST MOVERS Riluzole tabs 50mg 56 £13.40 -3 £22.76 -7 Price offers as at 28 October Rizatriptan tabs 10mg 3£0.82 -4 £1.96 -16 Product/Strength/Pack size August September October Sevelamer tabs 800mg 180 £92.69 ±0 £110.38 -1 Sildenafil tabs 100mg 4£0.29 -6 £0.58 -22 Omeprazole caps 20mg 28 104 137 107 Telmisartan tabs 80mg 28 £0.76 -1 £1.42 -19 Lansoprazole caps 30mg 28 92 114 96 Tolterodine tabs 2mg 56 £1.49 +3 £2.26 -2 Atorvastatin tabs 40mg 28 75 102 93 Citalopram tabs 20mg 28 69 100 92 Figure1(above): Comparison between the periods 1-30 September and 1-28 October 2015 of UK trade prices of the most recently-launched generics listed in categoryM Naproxen tabs 500mg 28 79 110 91 of the Drug Tariffofpharmacy-reimbursement prices. Averages calculated from at Clopidogrel tabs 75mg 28 75 103 88 least 33 data points. Figure2(top right) and Figure3(centreright): Biggest average trade-price changes between 1-30 September and 1-28 October 2015. Averages Simvastatin tabs 40mg 28 86 111 87 calculated from at least 18 data points. Figure4(bottom right): Ranking of fastest- Phenytoin tabs 100mg 28 73 96 85 moving products subject to the most price offers made to independent UK pharmacists Warfarin tabs 1mg 28 79 99 85 (one strength per ingredient; offers recorded by 28 October). Data for Figures 2, 3and 4fromabasket of about 750 commonly-dispensed generics. Recently-launched Paracetamol caplets 500mg 100 77 106 84 products in Figure1excluded from Figures 2and 3(Source –WaveData).

WANT MORE LIKE THIS? Up to the minute live retail market pricing is available for the UK and Eire on Wavedata Live at wavedata.net. Alternatively,contact Charles Joynson at WaveData Limited, UK. Tel: +44 (0)1702 425125.E-mail: [email protected].

6November 2015 GENERICS bulletin 23 Gen 6-11-15 Pgs. 24-26_Layout 1 04/11/2015 17:43 Page 2

BUSINESS STRATEGY Sawaisets sights on US and plans fordomestic demand

Japan’sSawai nits financial year ended 31 March 2015, Sawai term vision required becoming “a globally recognised Pharmaceutical passed several milestones.The generic drug company” with aturnoverof¥200 billion – Pharmaceutical is IJapanese generics specialist’ssales exceeded ¥100 around US$1.7 billion at current exchange rates –in filing products in the billion (US$830 million) for the first time, its research its financial year ending 31 March 2021. and development spending topped ¥6 billion, and the “Our newM1TRUST 2018 medium-term business US as it scales up its companytook its employee count above 2,000. plan is designed to give the companystrong momentum Sawaialso achievedastrategic goal in September towards those objectivesduring the next three fiscal production capacity 2014 by entering the Japanese biosimilars arena through years,”hestated in Sawai’s2015 annual report. to satisfy an aco-promotion contract covering Sandoz’ Filgrastim Reviewing the Osaka-based company’sprogress BS granulocyte-colonystimulating factor (G-CSF). under its previous M1 TRUST 2015 business plan, anticipated increase And perhaps most significantly for acompanythat Sawaisaid the group had “generally achieved” its goals has operated purely in its domestic market since its of establishing an “overwhelming number one presence in domestic demand. inception in 1929, Sawaitook “the first step in our in the generics market”, investing strategically in “new Aidan Fryreports. future development of overseas business” when the fields” and controlling costs across the company. US Food and Drug Administration (FDA) in May 2014 Industry leadership,Sawai outlined, had been accepted for filing the firm’sabbreviated newdrug supported by “becoming the only generic drug company application (ANDA) for pitavastatin tablets. to launch risedronate sodium 17.5mg tablets and Reviewing business models for building a carvedilol 1.25mg and 2.5mg tablets”. Furthermore, he biosimilars business and creating afoundation for pointed out, the firm had innovated by printing product overseas operationsare keyfacets of amedium-term information directly onto its cilostazol orally business plan entitled ‘M1 TRUST 2018’ that Sawai disintegrating tablets that used agreen-tea flavour unveiled in May this year as it reported a17.4% sales popular with the antiplatelet agent’starget age group. rise to ¥105 billion in its 2014 financial year ended 31 March 2015 (Generics bulletin,5June 2015, page 2). Just opened adevelopment centre This three-year business plan –aimed at maintaining To support further innovation as Japan’s“preferred growth “amid rapidly changing market conditions” – manufacturer of generic drugs”, Sawairecently finished also foresees the Japanese firm, aided by a¥30 billion building and opened aproduct development centre in bond issuance, investing around ¥44 billion to increase its Suita City near Osaka that is intended in part to develop production capacity from 10 to 15.5 billion tablets. drugs for overseas markets (Generics bulletin,5 And by increasing its volume share of Japan’s September 2014, page 5). “Utilising our outstanding generics market from 13.6% to 15.3%, Sawaibelieves patent-search and analysis competencyand advanced it will on average achieve 11.7% sales growth year-on- formulation capabilities,”Sawai commented, “we are year,taking the firm to aturnoverof¥147 billion by committed to speeding development of newproducts March 2018 (see Figure 1). and improving existing ones.” Mitsuo Sawai, who has served as the Japanese Towards the end of the business-plan period, Sawai group’spresident since 2008, said the firm’smedium- entered Japan’sbiosimilars market by signing aco- promotion contract covering Sandoz’ Filgrastim BS (Generics bulletin,16January 2015, page 19). 160 Generic penetration by volume of off-patent  147.0 In anticipationofincreased demand following the market including 2018 ‘roadmap’ target (%) ‘road map’ goal set by Japan’sMinistry of Health, 134.0  140 124.0 Labour and Welfare (MHLW) in 2013 of generics achieving avolume share of at least 60% of the off-  120 105.5 patent pharma market by March 2018 (Generics bulletin,7June 2013, page 12), Sawaihas also been 100 89.8 80.5 investing heavily in expanding its annual production 80 capacity to around 10.0 billion tablets, as well as almost 67.6 63.9 40 million injectableunits.  60 50.1 The Japanese companyinits final year of the M1 TRUST 2015 plan invested ¥13.3 billion in capital Annual sales (¥ billions)  40 60.0% expenditure (see Figure 2), not least in raising annual

46.9% output at its Kanto site from 2.3 to 3.5 billion tablets.  20 39.9% As the M1 TRUST 2018 three-year plan got 35.8% underway in April 2015, the Japanese group expanded 0 2010 2011 2012 2013 2014 2015 2016 2017 2018       its production network to six facilities by assuming M1 TRUST M1 TRUST 2015 M1 TRUST 2018 ownership of Mitsubishi Tanabe’sfactory in Kashima, Years ending 31 March near Tokyo(Generics bulletin,8May 2015, page 2). Figure1:Sawai’s reported and forecasted group sales in its financial years ending 31 March, along At the time, Mitsubishi Tanabe said the Kashima plant with actual and anticipated rates of generic penetration in Japan’s off-patent market (Source –Sawai) produced around 230 million tablets, 1.7 million

24 GENERICS bulletin 6November 2015 Gen 6-11-15 Pgs. 24-26_Layout 1 04/11/2015 17:43 Page 3

BUSINESS STRATEGY

syringes and 33 tons of powders and granules in the Capital
expenditure Research
and development expenses 12 months ended March 2014. However, Sawaiintends  16 to invest in increasing the site’scapacity. 14 13.3 Discussing the group’smedium-term business  plan to March 2018, Sawaioutlined similar priorities 12 to the previous plan, albeit with more ambitious goals. Capital investments totalling ¥44 billion are aimed 10 7.4 at raising annual production from 10 billion to 15.5 8 billion tablets as the group strivestostrengthen its 6.1

lue (¥ billions) 6 5.2 security of supply whilst cutting its raw-material costs. 4.6 4.3 4.6 4.6 Va 3.9 Building “a foundation for overseas business” 4 2.8 remains apriority,asdoes reviewing business models in the biosimilars arena. And as Sawaiseeks to “firmly 2 maintain the number-one market share in the [domestic] 0 2011 2012 2013 2014 2015 generics industry”, it anticipates achieving annual sales  growth of 11.7%, backed up by raising its volume Years ending 31 March share of Japan’sgenerics market from 13.6% to 15.3%. Figure2:Sawai’s capital expenditureand research and development spending in its financial years Sawaipointed out that the group had achieved ended 31 March 2011 to 2015 (Source –Sawai) sevenconsecutive years of turnoverand profit growth. But while higher sales to wholesalerslay behind a of 60% generic penetration of Japan’soff-patent market 17.4% turnoverrise to ¥105 billion in the firm’s2014 would be attained by the target of 31 March 2017. financial year ended 31 March 2015, its gross profit Furthermore, it wasbased on aplanned increased in the margin fell by more than three percentage points to country’sconsumption tax from 8% to 10% in April 43.1%, and its operating margin declined by 1.7 points 2017 not being accompaniedbyamajor revision of to 19.6% (see Figure 3). National Health Insurance (NHI) reimbursement prices. Under the goals of the M1 TRUST 2018 plan, Earlier this year (Generics bulletin,5June 2015, “Weexpect that in the Sawaiisforecasting 17.6% sales growth to ¥124 billion page 1), the MHLWsuggested that Japan should aim in its current financial year,although operating profit to achieve its 60% off-patent penetration target ayear next revision of the will fail to keep pace with amore modest 6.3% rise to early,byMarch 2017, with aviewtoraising penetration health insurance system, ¥22.0 billion. By March 2017, turnovershould reach to 80% by March 2021. Those proposals were picked ¥134 billion, ahead of reaching its target of ¥147 up by Japan’sCabinet Office, which suggested that the the government will billion in its 2017 financial year ending March 2018. target should be raised to at least 70% by mid-2017, “Although no newmeasures for promoting the and to 80% as soon as possible in the period up to substantiallyincrease its use of generics will be introduced, there are movements March 2021 (Generics bulletin,26June 2015, page 16). measures to promote by the government towards strengthening the function Citing MHLWdata, Sawainoted that generics’ of insurers, with the aim of promoting usage of generic volume share of Japan’soff-patent pharmaceuticals the use of generics by medicines,”the companyobserved. “Weexpect that market had risen from just overathird in March 2008, medical institutions” in the next revision of the health insurance system, to two-fifths by March 2012 and 46.9% in March 2014. the government will substantially increase its measures According to the company, generics nowaccount for to promote the use of generics by medical institutions.” just overhalf of off-patent drugs dispensed in Japan. The group’sfinancial year ended March 2015 saw To prepare for the anticipated uptick in demand at only aminor revision to dispensing incentivesor even the most modest 70% target for March 2021, the premiums for pharmacists, while ageneric-drug index, Japanese firm believesthe industry as awhole will have or usage target, wasestablished for hospitals that employ to increase its annual production capacity by 32 billion thediagnosis procedure combination (DPC) system of tablets –orby55% –from 58.0 billion at present to paying afixed fee for individual treatments. 90.0 billion pills within six years (see Figure 4). Sawaiexplained that, in drafting the medium-term plan, the companyhad assumed that the road map target Net sales Operating profit Operating margin (%) 

 

 

 (%) 120 Sales exceeded ¥100 billion 25 Generics

 volume Generics substitution rate  100 100 Generics substitution rate (estimate) 22.2 21.6 21.3 21.3 105.5 80  80 19.6 80 89.8 20 80.5 60  70.0% 60 63.9 67.6 60.8% 40 40 lue (¥ billions) 40 15

Va  50.7%

lume (Tablets billions) 90.0

Vo 20 72.0 20 34.2% 58.0 17.4 19.1 20.7 37.0 13.6 15.0 0 0 0 0  2011 2012 2013 2014 2015 2012 2015 2018 2021 (%)    Years ending 31 March Years ending 31 March

Figure4:Actual and anticipated generic substitution rates and Figure3:Sawai’s group sales, operating profit and operating margin in its financial years ended 31 generics volume demand in Japan (Source –Sawai) March 2011 to 2015 (Source –Sawai)

6November 2015 GENERICS bulletin 25 Gen 6-11-15 Pgs. 24-26_Layout 1 04/11/2015 17:43 Page 4

BUSINESS STRATEGY

Sawai–which manufactures around 90% of its 650 Production Sales volume 16 
 
 capacity products in-house –plans to do its part to avoid supply 15.5 15.0 shortages through its ¥44.0 billion capital expenditure 14 programme whereby it will increase its annual capacity  12 from 10 billion at present to 15.5 billion tablets by 11.3 11.0 10 March 2018 (see Figure 5). Over the same period, the 10.0 10.0 firm anticipatesits sales volume rising from 7.9 billion 8 8.7 to 11.0 billion tablets. 7.9 6 As can be seen from Figure 6, the bulk of capacity “As amanufacturer lume (Tablets billions) 4

expansion in the firm’scurrent financial year will be Vo 2 rather than atrading at its facility in Sanda, to the north-west of Osaka. With an annual output of up to 3.9 billion tablets, Sanda is 0 2015 2016 2017 2018 company, we have given set to overtakeKanto as the group’shighest-capacity    factory.Incorporating Mitsubishi Tanabe’sKashima Years ending 31 March little consideration to plant adds more than 200 million tablets to capacity. Figure5:Sawai’s actual and forecasted production capacity the possibility of “Asthe government’sroad map target may well and volume demand up to March 2018 (Source –Sawai) change, and therefore demand may exceed our entering the authorised exceptions, we will be prepared to boost capabilities “Rather than attaching cut-rate prices to products even more,”Sawai pledged. in which we have devoted our hearts and souls, we have generics field” Having in its 2014-2015 financial year launched givenour marketing departments the responsibility for 28 products based on 13 active ingredients, the Japanese helping customers understand the value of our products group intends to raise its researchand development and whytheyare worth using,”Sawai stated. Stressing investment by 50% overthe next three years to ¥23.5 the need to invest in meeting expanding demand for billion. In June this year,the companybolstered its generics, he promised that the companywould “refrain portfolio by launching rivals to Femara (letrozole), from measures aimed at short-term market share gains”. Flivas(naftopidil)and Plavix (clopidogrel) upon NHI Sawaiwas also phlegmatic about the threats posed listings (Generics bulletin,5June 2015, page 23). by both Japanese originatorsand foreign generics players looking to push into the country’sgrowing generics Planning 30 first-to-market launches market. “Because Japan’spharmaceuticals industry is “During the period of our newmedium-term plan,” subject to rigorous government licensing,itisimpossible Sawaistated, “we plan to be first-to-market with high- for newmarket participants to emerge overnight,”he value-added generic versions of some 30 existing drugs.” maintained, adding that market entrants would also have However, he insisted, the companywould not bow to adapt to Japan’s“emphasis on strict quality standards”. to competitive pressure to become adeep discounter.“In Addressing the increasing prevalence of authorised responsetogovernment measures to promote generic- generics marketed by,orwith the consent of, originators drug usage,”heobserved, “some companies have –such as the version of Takeda’sBlopress (candesartan) adopted low-price strategies to expand market share; launched by Aska ahead of generic competition we will avoid this.” (Generics bulletin,6June 2014, page 14) –Sawai said Such price-cutting strategies had been exacerbated, such launches “do not represent amajor threat to Sawai” he said, by the introduction from April 2014 of three provided theydid not occur considerably ahead of price bands for NHI-listed generics –those with prices generic market formation or gain approvalfor 50% or more of the corresponding original, those indications different to those of true generic rivals. priced at 30% to 50% of the reference brand, and “When companies are dependent on marketing those costing less than 30% of the original. authorised generics procured from originators, after Reimbursement prices are then determinedbythe several rounds of NHI drug-pricerevisions, theywill weighted averages of products within each price band. become unable to generate profits,”hepredicted. Sawai, by contrast, would focus on value-added generics. “Asamanufacturer rather than atrading company,” 
Kanto 
Sanda 
Kyushu 1 he added, “we have givenlittle consideration to the Kashima possibility of entering the authorised generics field.” 12  
Kyushu 2 
 11.3 0.2 By focusing on offering added-value rivals to 10.0 2.0 original brands, Sawaiestimates that it reduced 10  8.6 1.9 Japan’smedical-care expenses by ¥200 billion in the 8.0 8 1.7 year ended March 2015. And nowthe Japanese firm  1.9 1.6 1.9 feels ready to takethat savings potential overseas. In 6.0 6 1.4 particular,the group is “strengthening our in-house 1.1 3.9 1.8 3.0 development systems to submit applications for our

4 3.0 second and third products in the US”. 0.9 3.0 lume (Tablets billions) “While it is difficult to forecast Sawai’slong-term Vo outlook,”the company’spresident summarised,“in 2 2.8 3.5 3.5 2.0 2.3 addition to launching operations in the US, we recognise 0.5 that we have asocial responsibility to help meet the 0 2012 2013 2014 2015 2016 needs of people in Asia who lack full access to Years ending 31 March pharmaceutical products. Iamhoping to see Sawai’s Figure6:Sawai’s actual and forecasted production capacity, high-qualitygeneric products come to play an important split out by facility location (Source –Sawai) role in meeting the world’sunmet medical needs.”G

26 GENERICS bulletin 6November 2015 Gen 6-11-15 Pg. 27_Layout 1 04/11/2015 17:44 Page 1

PEOPLE

PROMOTIONS APPOINTMENTS Perrigo’s Papa hands Lupin appoints heads over presidency role for two of its regions

errigo’sglobal operations and supply chain head, John upin has appointed Martin Mercer and Fabrice Egros as presidents PHendrickson,has been promoted to companypresident. He takes Lof its Latin Americanand Asia-Pacific regions respectively. the title from JoePapa,who had served as the US store-brands Mercer assumes “full responsibility for the company’sLatin specialist’spresident and chief executive officer since October 2006. American business including the company’soverall strategy for its Papa will continue to serveinthe latter position, as well as serving generics and specialtybusiness in Brazil, Mexico, Venezuela, Colombia as companychairman as he has since 2007. and Argentina”. He joins Lupin from Astellas Pharma, where he was A26-year companyveteran, Hendrickson –who will in his new also head of Latin America, having also worked for Valeant. Lupin role report directly to Papa –took on his former position in March said Mercer –who will be based in Naples, Florida –had “significant 2007, having previously led Perrigo’sConsumer Healthcarebusiness. experience in acquisition integration, change management and His promotion comes as the US firm announced several initiates restructuring, business development and newproduct development.” aimed at “maximising efficiencyand productivity,and further leveraging Egros is based in Tokyo, Japan, where Lupin has stated adesire the strength of Perrigo’sglobal platform”, in order to “delivershareholder to be the “first Indian companytolaunch biosimilars”. He assumes value farsuperior” to Mylan’shostile takeoveroffer (see page 5). G responsibility for “growth and development across keymarkets such as Australia, the Philippines, South-East Asia and newmarkets in the IN BRIEF rest of the Association of Southeast Asian Nations (ASEAN) region”. Egros wasformerly NovaMedica’schief operating officer. GEDEON RICHTER has removedcommercial director Endre Lupin has expanded in Latin America overthe past fewyears with Pokomándi less than four months into the job (Generics bulletin, the acquisition of Grin in Mexico (Generics bulletin,4April 2014, 5June 2015, page 35). Providing no further details on the “termination” page 3) and also in Brazil where it recentlytook overlocal player of Pokomándi’semployment, the Hungarian firm said managing Medquímica (Generics bulletin,22May 2015, page 1). Lupin’sboard director Erik Bogsch would supervise commercial activities until recently approvedraising Rs75.0 billion (US$1.15 billion) in capital. the appointment of anew director. G The Indian companydid not respond to enquiries about a replacement for its former presidentofEurope and inhalation strategy, Maurice Chagnaud,who recently joined Polpharma (Generics bulletin,2October 2015, page 35). Lupin’sboard has appointed BioMérieux’ director-general, Jean-Luc Belingard,asanindependent director for afive-year term. G

BUSINESS DEVELOPMENT MANAGER INDUSTRY ASSOCIATIONS PHARMACEUTICALCOMPANY active in the EGA hands Maréchal bio role development and commercialization of branded, generic and consumer health productsislooking for ulie Maréchal-Jamil has assumed the role of director of biosimilars a BUSINESS DEVELOPMENT MANAGER based at its Jpolicyand science at the European Generic and Biosimilar Barcelona headquarters,for itsEastEurope markets. medicines Association (EGA). She waspreviously the association’s director of quality and regulatory affairs. Requirements: Maréchal-Jamil takes overresponsibility from Suzette Kox for ● Minimum of 2 years experience in a similar role in the developing biosimilar policies, as well as coordinating and managing pharma businessand with international exposure. the EGA’s European Biosimilars Group (EBG) sector group. Quality issues including good manufacturing practice (GMP) and bioequivalence ● University degree (preferably in Life Science). are covered by the EGA’s quality and regulatory manager, Koen ● Availability to travel up to 40%ofthe time. Nauwelaerts.The association’ssafety and regulatory manager, Katarina ● Self-motivation and desire for hard work and success. Nedog,oversees issues includingpharmacovigilance and telematics. As senior director,international, Koxwill nowfocus on ● Good communication,presentation and interpersonal skills. expanding the EBG’sinternational outreach activities and will continue We offer: to be the programme director for the annual EGA/EBG Biosimilars ● Full-time position. Conference, which will takeplace on 28-29 April in London, UK. G Competitive salary. ● IN BRIEF ● Employee benefits program.

● Working in a well-established and successful company MPP –the Medicines Patent Pool –has expanded its governance with a presence in over 70 countries in the world. board by adding four newmembers, including former Ranbaxy chief Brian Tempest.“As the MPP starts the second phase of its HIV work Challenging and stimulating work at an international level. ● and explores newdisease areas, ramping up its engagement with Interested...? Contact [email protected] manufacturers will be essential,”Tempest commented. G

6November 2015 GENERICS bulletin 27 Generics BC House Ad 04-2015_Layout 123/04/2015 10:53 Page 1

Generics bulletin print

Generics bulletin-i digital

News@Genericsbulletin electronic newsflash

INDIVIDUAL SUBSCRIPTIONS The bestdecision-makersinthe genericsindustrydon’thave the An annual subscription comprises: time to go lookingfor goodinformation. Theylet it cometothem. n 20 Generics bulletin newsletters; TheysubscribetoGenerics bulletin. n ANDatleast 46 weekly Join thous News@Genericsbulletin electronic andsofsubscribers from competitor companies in newsflashescontaining the week’stop nearly 60 countries whoare alreadybenefitting from commercial news stories (currently delivered by email). intelligence about business opportunities in theglobal generic medicinesand biosimilars markets. CHOICE OF FORMATS The 20 Generics bulletin newsletters GOOD VALUE -Individual subscription rates start from just£895 are available: n EITHER as the digital Generics bulletin-i for online access by desktop ANDtablet and smartphone. These mobile devices can have Apple or Androidoperating systems; AVAILABLEINSTANTLY WORLDWIDE n OR in traditional hard-copyprint format, Generics bulletin-i is the digital i-edition of Generics bulletin. delivered by airmail; Nowavailable online for desktop access,itdelivers the latest Generics bulletin on the day of publication withnopostal delay.Italso comes –atNOEXTRA CORPORATE SUBSCRIPTIONS CHARGE –asanapp for mobile access by tablet and smartphone. Acorporate subscription provides location-, Generics bulletin-i subscribers also get access to afully-searchable archive.This contains over country- or company-wide access to five years of generics news and analysisinmore than 100 back issues. These offer an invaluable Generics bulletin-i. resource for researching marketing opportunities,benchmarking competitivestrengths, evaluating regulatory changes and assessing product developments. Contact [email protected]. Existingsubscribers can get 20% OFF when theyupgrade theirsubscriptions to include Generics bulletin-i.Contact [email protected].

Take out asubscription TODAYatwww.Generics-bulletin.com or contact: [email protected]

Bulletin PublishingGroup, OTCPublications Ltd, 4Poplar Road, Dorridge, SolihullB93 8DB, UK. (Tel: +44 (0)1564 777550; Fax: +44 (0)1564 777524). Registered in England No: 2765878. VATNo: GB 608 0432 69