Teva Pharmaceutical Industries Limited
) and Active Biotech announced that their oral multiple sclerosis
(MS) candidate, Nerventra, received a negative opinion from the
European Medicines Agency's (EMA) Committee for Medicinal
Products for Human Use (CHMP). The companies are looking to get
the candidate approved for the treatment of relapsing-remitting
multiple sclerosis (RRMS).
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The CHMP rendered a negative opinion as it believes that the
potential risks associated with Nerventra outweigh the benefits
based on currently available data. Data found in animal studies -
a higher occurrence of cancer after long-term exposure to
Nerventra - and chances of an adverse effect on the unborn baby
when taken by pregnant women, led to the CHMP opinion. Teva and
Active Biotech are planning to request a re-examination of the
CHMP opinion. Teva's shares fell 2.45% on the news.
We are disappointed with CHMP's opinion on Nerventra. The
successful development and launch of Nerventra would help
strengthen Teva's multiple sclerosis drug portfolio. Teva already
has a multiple sclerosis product in its portfolio - Copaxone.
However, Copaxone could start facing generics this year. Last
month, Teva provided guidance for 2014 based on two scenarios
related to Copaxone - Copaxone remaining exclusive and Copaxone
going generic. The entry of Copaxone generics this year could cut
total revenues by about $500 million and earnings by 60 cents.
We note that several oral multiple sclerosis therapies are
currently available including
) Gilenya and
) Tecfidera among others. Competition in the oral multiple
sclerosis market is intense and Nerventra needs to demonstrate
superior efficacy and safety to gain share in this market.
Teva carries a Zacks Rank #5 (Strong Sell). Some better-ranked
) carrying a Zacks Rank #2 (Buy).