Actavis Ordered to Keep Older Alzheimer’s Drug Namenda on the Market
May 26, 2015
By Alex Keown, BioSpace.com Breaking News Staff
WASHINGTON -- A federal appeals court ruled Ireland-based Actavis plc cannot pull older drugs treating Alzheimer’s disease, such as Namenda, in favor of switching patients to a newer drug that is patent protected in order to protect revenues from generic drugs that will soon hit the market, the Wall Street Journal reported Friday.
After Forest Laboratories, Inc. , which is owned by Actavis, announced it was halting sales of Namenda, a twice-per day Alzheimer’s medication in favor of the newer and patent-protected Namenda XR, Eric Schneiderman, New York’s attorney general, filed an anti-trust lawsuit against Actavis. The patent for Namenda XR expires in 2025.
The appeals court upheld an earlier court’s ruling that Actavis must keep the older version of the drug on the market.
Actavis argued Namenda XR is a better deal for patients, saying the drug is more convenient, and the contents of the capsule can be sprinkled on food for patients who have difficulty swallowing.
Schneiderman called the appellate court’s ruling a “sweeping victory for consumers and Alzheimer’s patients.”
“Our lawsuit and the court’s injunction protect competition and prevent Actavis from coercing Alzheimer’s patients into taking drugs they do not want in order to charge them monopoly prices. The litigation brought by my office sends a clear message: Drug companies cannot illegally prioritize profits over patients,” Schneiderman said in a statement.
Although disappointed with the ruling, Actavis’ officials said they would continue to “convey the significant benefits of Namenda XR to physicians, patients and caregivers.”
"Patient demand for Namenda XR is currently trending at more than 50 percent of the total product line's days of therapy and growing, underscoring the strong physician, patient and caregiver demand for our once-daily product,” Brent Saunders, president and chief executive officer of Actavis, said in a statement. Actavis said it will continue to manage sales and research and development expenses to ensure that the court’s decision will have “minimal to no impact on its 2015 Namenda franchise contribution to earnings and longer term company earnings aspirations.” In its quarterly report last month Actavis said it was seeking a 60 conversion rate to Namenda XR before generics have an impact on the bottom line. Generic versions of Namenda IR are expected to enter the market sometime in July.
Following news of the appellate court’s decision, Actavis PLC’s stock was trading down this morning at$300.88 per share. The stock previously closed at $301.52.
The lawsuit has been closely watched by the pharmaceutical industry, particularly the notion of whether or not the forced switching of drugs will create unfair monopolies.
Erik Gordon, a professor at the Ross School of Business at the University of Michigan, told the Wall Street Journal the ruling is an important one because of the difficulties it makes on drug makers forcing patients to switch to newer medications that are patent protected from generic competition.
In addition to the newer Namenda XR, Actavis earlier this month launched once-daily Namzaric, a fixed-dose combination of Namenda XR and donepezil. Namzaric provides another treatment option for patients with moderate to severe Alzheimer's disease, the company said. Namzaric was approved by the U.S. Food and Drug Administration (FDA) in December for the treatment of moderate to severe Alzheimer's disease in patients stabilized on memantine hydrochloride and donepezil hydrochloride.
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