Zacks_Analysts' Blog : Medicines Co. Settles with Teva - Analyst Blog

The Medicines Company (MDCO) recently entered into an agreement with generic player Teva Pharmaceuticals (TEVA) regarding generic versions of The Medicines Company’s lead product, Angiomax.



Angiomax (bivalirudin), which was acquired from Biogen Idec, Inc. (BIIB) in 1996, is used as an anticoagulant in patients undergoing coronary angioplasty. Angiomax is the company’s lead product, accounting for 99.8% of total revenues in 2010.



Teva admitted that the two patents challenged by it are valid and enforceable and would be infringed by its generic version. The patents, which were the focus of the patent infringement lawsuit, are slated to expire on July 27, 2028.



ANDAs Filed in 2009



Teva and its affiliate, Pliva Hrvatska d.o.o., had filed abbreviated new drug applications (ANDA) in 2009 seeking US Food and Drug Administration (FDA) approval for their generic versions of Angiomax. Later that year, The Medicines Company filed patent infringement lawsuits against the generic companies.



Details of the Settlement Agreement



Per the terms of the settlement agreement, The Medicines Company granted a license to Teva and its affiliates under which they can launch a generic version of Angiomax in the US on June 30, 2019. The generic could be launched earlier under certain specific circumstances.



The Medicines Company also signed an agreement with Teva under which the latter will supply Angiomax’ active pharmaceutical ingredient (API) to The Medicines Company.



The settlement of the patent infringement lawsuit removes a significant overhang from The Medicines Company. With Angiomax accounting for a major part of the company’s revenue, the delay in the entry of generic versions of the product is a huge positive.



Although The Medicines Company is still facing patent challenges for Angiomax from other generic companies like APP Pharmaceuticals, Hospira (HSP), Mylan Pharmaceuticals (MYL) and Dr. Reddy's Laboratories (RDY), we believe the company will enter into settlement agreements with these companies as well to delay the entry of generics.



We currently have a Neutral recommendation on The Medicines Company, which carries a Zacks #3 Rank (short-term Hold rating).
Read the full analyst report on "MDCO"
Read the full analyst report on "TEVA"
Read the full analyst report on "BIIB"
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