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

To: Montana Wildhack who wrote (11337)	11/3/2002 3:29:47 PM
From: padco	Read Replies (1) \| Respond to of 14101

Wolf - here's some more interesting FDA/patent stuff. It just illustrates how wild this pharma business can get. If I've got this correct, it seems that three companies got FDA approval for a generic version of AstraZenaca's drug Prilosec. AZ sued them for patent infringement and only one of the companies won the lawsuit. Therefore only that company (KUDCo) can sell the generic version even though it agrees to share a small percentage of the profit with the other generics. Another interesting thing discussed, which could impact our Pennsaid ((IF)) is that Prilosec may go OTC next year. That would cause its price to drop 50% which would in effect hinder the sales of the generics. Very interesting! Associated Press 3 Cos. Join Forces in Prilosec Bid Friday November 1, 6:54 pm ET By THERESA AGOVINO, AP Business Writer Three Drug Companies Join Forces in Bid to Launch Generic Version of Ulcer Medicine Prilosec NEW YORK (AP) -- Three generic drug companies have joined forces to launch a generic version of the blockbuster ulcer medication Prilosec by the end of the year. The new version eventually could save consumers and businesses billions of dollars. ADVERTISEMENT Andrx Corp. and GenPharm Inc. will relinquish their six-month, co-marketing exclusivity for a generic form of Prilosec to Kremers Urban Development Co., known as KUDCo, for a share of the profits. On Friday, the U.S. Food and Drug Administration gave final approval to KUDCo's version of Prilosec, which goes by the generic name omeprazole, paving the way for the launch. Last month, KUDCo was the only one of four generic drug makers -- including Andrx and GenPharm -- to win a patent infringement suit against Prilosec's manufacturer, AstraZeneca PLC. KUDCo couldn't say more specifically when it would launch the drug, but said it would begin marketing even if AstraZeneca decides to appeal the judge's ruling. AstraZeneca hasn't made a decision but KUDCo could owe the drug giant significant amounts of money if it loses on appeal. "We have looked at the judge's decision and are even more confident in our legal position," said KUDCo spokeswoman Laurie Nelsen. "We plan to launch in the near term. We are working to get it out as quickly as possible." UBS Warburg analyst Steve Valiquette said KUDCo is likely insured against any negative judgment, so it makes sense for the company to proceed. "It is a very calculated risk," Valiquette said. Analysts estimate KUDCo could rack up sales of $750 million to $950 million in its first year, a figure limited by the company's ability to produce the drug. KUDCo says it has capacity to meet only 50 percent of Prilosec prescriptions. Valiquette says KUDCo will likely price the drug 25 percent below Prilosec's $3.69 wholesale per-pill price. Typically, the price of a generic drug drops to 50 percent below the brand-name's price after six months, when numerous companies enter the market. That's unlikely to happen in this instance, because the other generic companies with FDA approval lost their patent case. Credit Suisse First Boston analyst David Maris believes KUDCo will likely contract with other companies to make the drug so it can win a bigger market share. Consumers lacking prescription drug coverage will be further helped by the expected 2003 launch of an over-the-counter version of Prilosec. Maris said that version could cost about 50 percent less than Prilosec, which could actually hinder generic sales. "Consumers win because of the generic version and win again when an OTC version hits the market," Maris said. Valiquette estimates the combination of generic and over-the-counter versions of Prilosec could save consumers $1 billion in the first year they are on the market, while Maris thinks it could take closer to two years to achieve such savings. The six-month patent infringement trial, in U.S. District Court in New York, was closely watched by drug executives, consumer groups and legislators because Prilosec had become the lightning rod for criticism over the high cost of prescription drugs. Last year, Prilosec was the world's second biggest selling drug, with revenues of $5.7 billion. U.S. sales totaled $3.7 billion. Prilosec's cost had become such an issue that last year 18 governors took the unusual step of sending a letter to U.S. Health and Human Services Secretary Tommy Thompson asking him to approve a generic version because the delay was costing consumers and states $6 million a day. General Motors Corp. alone spent $55 million last year on Prilosec prescriptions for the 1.2 million people covered under its health plans. It estimates the generic version of the drug will save it $69 million over three years. In an unusual move, Thompson was quoted in the FDA press release announcing KUDCo's approval. "The FDA's action represents a win-win for patients all across America," Thompson said. "For those who are successfully taking this prescription, it means potential savings and for those who could not afford the brand name drug, it means greater access to a successful medication at a lower cost." Analysts and generic drug company executives said Thompson's comment reflects the importance of drug costs in the political debate. Congress failed to pass either legislation that would make it easier for generic drugs to get to market or provide a drug benefit to senior citizens. However, the Bush administration last month proposed regulations that would make it more difficult for brand name drugs to hinder generic drug companies from launching products. Under the agreement, Andrx and GenPharm initially will receive 15 percent of KUDCo's Prilosec profits but their share will dwindle to 6.25 percent over an unspecified time. Andrx shares rose 19 percent, or $3.92 a share, to $18.37 on the Nasdaq Stock Market. AstraZeneca shares were down almost 6 percent, or $2.13 a share, to $35.42 in trading Friday on the New York Stock Exchange. biz.yahoo.com