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Novartis tastes own medicine, Advair generic delayed

Published on 08/02/18 at 10:32am

Novartis had not been frontrunner to receive approval for its generic version of GSK’s Advair – lagging behind Mylan’s generic and a Hikma and Vectura partnership product. However, both went in front of the FDA and found their versions hit by CRLs.

For Novartis, it could not have panned out any better. It had suddenly jumped to the front of the queue and would be only the second company to bring its generic version of the blockbuster drug, behind Teva.

Novartis had been so eager to delay its rivals, it had even filed a citizen petition to the FDA asking that it ensure more strenuous checks were undertaken on any generic filings for Advair.

This decision seems to have backfired spectacularly, as Sandoz revealed that it had been hit with a CRL by the FDA – though on what grounds it had been rejected was not revealed.

The FDA’s decision means that Novartis’ generics company is unlikely to launch its generic Advair this year.

It’s a blow for Sandoz, after it was revealed in financials only last month that the business was struggling due to increased pricing pressures in the US market – seeing its net sales drop by 2% and its operating income fall by 7%.

There is one clear winner from the decision, as GSK can now breathe slightly easier in the knowledge that it leaves only Mylan able to bring its product to market this year.

GSK had predicted that generic competition could see sales of Advair fall by 25% but it now seems likely that this figure, if only Mylan’s generic is approved, could be much lower. In the situation where even Mylan cannot make it to market, GSK revealed that it would expect earnings per share growth of between 4-7%.

Competition against Advair has been a serious question mark over GSK for the last few years but the company has avoided making big acquisitions to try bolster its portfolio against the loss, preferring to promote its Trelegy Ellipta as the logical follow-on choice.

However, GSK CEO, Emma Walmsley, has made no secret that the company is having a hard look at both Pfizer and Merck KGaA’s healthcare business, as both companies look to shed their units.

GSK’s share price was 3.4% up on the news.

Ben Hargreaves

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