Actavis Challenges Patents - Analyst Blog

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Actavis, Inc. ( ACT ) announced that it is seeking U.S. Food and Drug Administration (FDA) approval for its generic versions of Sanofi 's ( SNY ) Multaq and Takeda Pharmaceutical Company Limited 's ( TKPYY ) Colcrys. While Multaq is an antiarrhythmic drug for reducing the risk of hospitalization for atrial fibrillation (AF) in patients in sinus rhythm with a history of paroxysmal or persistent AF, Colcrys is used for the prevention and treatment of gout flares.

Both Sanofi and Takeda have filed patent infringement lawsuits against Actavis for their respective drugs. The filing of the lawsuits within the stipulated time period under the Hatch-Waxman Act ensures that the FDA cannot grant final approval to Actavis' generics versions for up to 30 months (until Jan 1, 2017 in Multaq's case) or the court's decision, whichever is earlier.

According to IMS Health, total U.S. sales of Multaq during the 12 months ended Dec 31, 2013, were $319 million. Meanwhile, Colcrys sales in the U.S. during the same time period were about $629 million, according to IMS Health. Actavis believes that it was first-to-file an abbreviated new drug application (ANDA) for a generic version of Multaq - if that is the case, Actavis would be entitled to 180 days of exclusivity on gaining FDA approval for its candidate.


Our Take

We are pleased with the progress of Actavis' generic pipeline. While Actavis continues to work on driving generic product sales, the company is also working on strengthening its branded product portfolio. Last month, Actavis announced its intention to acquire Forest Laboratories Inc. ( FRX ). The acquisition will lead to the creation of a specialty company with sales of more than $15 billion per year, a well-diversified portfolio and a presence in varied geographical areas. The Forest Labs acquisition will push up Actavis' branded products revenues to 50% of total combined revenues from the current level of 30% of the standalone company's revenues. The Forest Labs acquisition will also bring about significant synergies and boost earnings and revenues.

Actavis and Forest Labs both carry a Zacks Rank #2 (Buy).



ACTAVIS PLC (ACT): Free Stock Analysis Report

FOREST LABS A (FRX): Free Stock Analysis Report

SANOFI-AVENTIS (SNY): Free Stock Analysis Report

TAKEDA PHARMACT (TKPYY): Get Free Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.




This article appears in: Investing , Business , Stocks

Referenced Stocks: AF , ACT , FRX , SNY , TKPYY

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