Ivax Gets OK to Sell Generic Form of Cancer Drug Taxol
Ivax Corp. on Friday received approval from U.S. regulators to sell a generic form of Taxol, a victory in the company’s heated battle to sell a copycat version of Bristol-Myers Squibb Co.’s blockbuster treatment for ovarian and breast cancer.
Ivax has been fighting New York drug giant Bristol-Myers for two years to sell its version of Taxol, whose chemical name is paclitaxel. It will be the first generic form of Taxol on the U.S. market, which means no other generic drug maker can sell generic paclitaxel for 180 days.
Miami-based Ivax said its generic will be available this fall. Although Ivax would not say how much it will charge for the drug, generic versions of blockbuster pharmaceuticals are typically 30% cheaper than their brand-name competitors.
“This is going to be sold at a significantly reduced price,” Ivax President Neil Flanzraich said.
Taxol, which Bristol-Myers launched in 1993, had been expected by Wall Street analysts to have U.S. sales in 2000 of more than $1 billion. But Taxol will now have to contend with the Ivax version of the drug, which some analysts believe could cause Taxol sales to be cut by as much as $300 million. Taxol is the second-biggest drug for Bristol-Myers, which has annual sales of about $21 billion.
Such a contribution from a new drug would be a big boost for Ivax, which in 1999 had sales of $669 million and operating earnings of 63 cents per share. It had been expected to earn 84 cents per share in 2001, according to analysts polled by First Call/Thomson Financial.
“At this point, you could say that it could represent over $100 million in revenue and 20 cents or more to earnings per share in 2001” for Ivax, said analyst Gregory Gilbert of Merrill Lynch.
Uncertainty about the outcome of the patent battle has weighed down share prices of both Ivax and Bristol-Myers.
On the New York Stock Exchange, Ivax shares rose $2.25 to close at $43.50, and Bristol-Myers rose 13 cents to close at $53.44, off its high earlier in the day of $54.94.
“The big question has been when would Ivax get final approval. Now we know and can move forward and focus on other aspects of Bristol-Myers,” said analyst Adam Green of Wasserstein Perella Securities.
Miami-based Ivax has accused Bristol-Myers of attempting to delay introduction of its cheaper product.
“Anyone who has followed Ivax’s efforts to bring its generic version of Taxol to market in the United States knows Ivax has had to overcome a succession of disruptive and delaying tactics,” Flanzraich said.
A Bristol-Myers representative said the company was not commenting on the Food and Drug Administration’s approval at this time.
A federal judge in Newark, N.J., in March invalidated key provisions of patents protecting Taxol, but Bristol-Myers lawyers continued to challenge the Ivax product.
Then last month, Ivax received tentative approval from the FDA to begin marketing its generic version, but the FDA go-ahead was contingent on Ivax resolving its patent disputes.
The fight between Bristol-Myers and Ivax took a decisive turn last week, when U.S. District Judge William Byrne in Los Angeles ruled against privately held Santa Monica-based company American BioScience Inc., which had a business arrangement with Bristol-Myers.
Bristol-Myers had signed an option for a nonexclusive license to American BioScience’s Taxol-related patent. Despite their relationship, American BioScience then sued Bristol-Myers and demanded it list American BioScience’s patent in the FDA’s official patent registry. Listing a patent automatically triggers a 30-month FDA review.
Byrne initially ordered Bristol-Myers to have the BioScience patent listed, but reversed course Sept. 6, saying he had no jurisdiction in the case and that Bristol-Myers must delist the BioScience patent. The U.S. 9th Circuit Court of Appeals on Wednesday upheld Byrne’s decision.
“We were notified of a change in the status of a patent for Taxol [by the California court], and after being notified, that’s when we took the action” to approve Taxol, said Gary Buehler, acting director of the FDA’s Office of Generic Drugs.
Meanwhile, the Federal Trade Commission has opened an inquiry into whether Bristol-Myers and American BioScience colluded to delay Ivax’s generic version from coming to market.
