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Gold/Mining/Energy : Nuvo Research Inc -- Ignore unavailable to you. Want to Upgrade?

To: TheBusDriver who wrote (11336)	11/3/2002 12:39:31 PM
From: Montana Wildhack	Read Replies (1) \| Respond to of 14101

For those who may not read the Stockhouse board (SH) there was a very useful exchange between Lashman and DI7026 which I think will be of interest to all here. Lashman wrote: In the article below in today's edition of the Globe and Mail, Biovail received FDA approval to market a drug using a new delivery system. They won't be able to sell the drug until the patent expires in 2006 but they received approval 4 years prior to the patent expiration date. This suggests that a drug company could also seek to obtain approval to market generic versions or even altered and improved versions of Pennsaid in advance of its expiration which could then be sold immediately after the expiration of the Pennsaid patent. Saturday, November 2, 2002 – Page B4 Drug maker Biovail Corp. has received clearance from the U.S. Food and Drug Administration for its rapidly dissolving oral formulation of the compound zolpidem, which is sold as Ambien to treat insomnia by Sanofi-Synthélabo of France. Sanofi's sales of Ambien were $1.1-billion (U.S.) for the 12 months ended June 30. But its patents on the drug last until October, 2006, which blocks Mississauga-based Biovail from selling its "flashdose" Ambien in the United States for four years. "We are looking at opportunities in other markets, jurisdictions outside the U.S.," Biovail vice-president of finance Kenneth Howling said in an interview yesterday. J.P. Morgan Securities Inc. analyst Corey Davis said he doubts Biovail will challenge Sanofi's patent. "The biggest value to Biovail, in our view, is the ability to use [FDA approval] as a bargaining chip with Sanofi, the only company that could launch the flashdose product prior to 2006," he said in a new report. Mr. Howling declined comment on a possible co-promotion accord with Sanofi to launch a melt-in-your-mouth version of Ambien. Steven Valiquette, an analyst with UBS Warburg LLC, said the FDA decision is Biovail's first approval of a flashdose product and "it validates the technology." Separately, drug maker Andrx Corp. of Fort Lauderdale, Fla., said it expects to receive FDA approval during the current fourth quarter to launch its generic version of Biovail's hypertension drug Tiazac, which is expected have sales of $185-million in 2002. Mr. Howling said Biovail has already shipped its own generic version of Tiazac to its U.S. marketing partner Forest Laboratories Inc. of New York in order to compete against Andrx. Dimi Ntantoulis, an analyst with National Bank Financial, predicted that Biovail and Forest will capture 75 per cent of the generic Tiazac market, with Andrx getting the remaining 25 per cent. To which DI7026 replied: Lashman, thanks for your post on Biovail's news of receiving approval for marketing generic Ambien. Interestingly, as you pointed out, they have just received the approval but have to wait till 2006 to actually sell Ambien since the patent will only expire then. In fact there is a bit more to this story. The Ambien patent was originally expected to expire on 21 Oct 2001; however Pharmacia /Sanofi was able to extent the patent life by 5 years, the maximum length allowed. On the following web site, a list of drugs that have received patent extension was shown, including that for Ambien. uspto.gov I believe that Biovail started working for the generic approval with the original 2001 expiration date as its target date; but it turned out in the end that Sanofi was able to extent the patent all the way till 2006, leaving Biovail hanging out there for another 4 years before they can sell generic Ambien. This is the gamble that Biovail decided to take to be the first generic on the market. Usually a generic company would not spend its resources on obtaining copy cat approvals until an Rx has been on the market for a # of years so that there is enough marketing and sales figures to justify its financial committment. In this case, Ambien was originally approved in the US in 1993, and Biovail did not initiate its generic program until years after the drug has been on the market. It's during this period that Biovail has a chance to evaluate the profitability of this product as a generic drug. Using the same line of logic, one would expect generic versions of Pennsaid to be available only after it's been on the market for at least a few years, regardless of the patent expiration date. ...end of two posts on SH... It's interesting to review that link and while I haven't yet done any work on percentage of extensions versus total approvals etc., I have noted that what I was being told seems to hold which is that drugs approved with a relatively short overall market life tend to get at least a 2 year extension provided it was in the NDA at least that long. I noted also the tendency for more recent decisions to be valued in days compared to the tendency to years being assigned generally earlier. This suggests to me its true that the FDA keeps a log of the number of days the NDA takes. I believe they may well track the number of days the ball is 'in their court'. This ties in with Rebecca's statement at the AGM that she would be satisfied with a 3 year extension although the maximum is apparently 5 years. I believe it is likely that the FDA will decide to assign an extension in the 2+ year range and that Pennsaid will end up expiring in 2006/2007. This 4-5 year market protected window is relatively quite short which is why I have been posting about any US partner necessarily having an OTC or post-patent life strategy. This strategy no doubt involves a drastic reduction in price from lets say the mid 30's to the $7-$11 range; but, still has a sweet spot given the very low per unit manufacturing cost. Another issue surrounding this is getting the Fungal and any other product patents applied for before the 2004 expiration of the 1984 patent. Provided they have jumped the necessary hoops for requirements the fungal product can have a full life of its own long after the base patent has expired. BTW - I keep talking about the JNJ business case. I was suprised how little came up on the net that was useful, but, here is a link that does a decent job documenting a business plan which is very similar. If you're not familiar with them it might be worth the time to glance through and get a better feeling for the detail that gets committed to in a constant state of insufficient information. entre-corp.com Just like an investor, an approver of a business case takes a risk. This example is a relatively simple one involving starting up a business for tennis rackets. It's a decent structure though and is worth a look for those who want to learn more about it. Wolf