TWi Pharmaceuticals Inc (安成) may not be able to launch its generic version of Par Pharmaceutical Inc’s megestrol acetate — used to boost appetite and induce weight gain in patients with anorexia or AIDS — in the US market by the end of this quarter as expected, following an injunction ruling by a US district court.
However, the Taiwanese developer of specialty generic drugs could receive compensation from Par Pharmaceutical for the delay and its new drug development prospects for next year remain promising, analysts said.
“Getting a court to issue an injunction is a common way for brand companies to delay the launch of generic drugs and is irrelevant to FDA [US Food and Drug Administration] drug approval,” UBS Securities Pte Ltd said in a client note on Wednesday.
The analysts’ remarks came after Par Pharmaceuticals on Wednesday obtained a preliminary injunction ruling from a Maryland district court to bar TWi from launching the product before a final verdict from the Court of Appeals for the Federal Circuit.
In a filing with the Taiwan Stock Exchange on Wednesday, TWi confirmed the injunction ruling, but said Par Pharmaceutical had paid a bond of US$10 million in seeking the injunction and TWi would be fully compensated for all losses from the delayed launch if the final verdict is in its favor.
In February, TWi won a patent lawsuit against Par Pharmaceutical regarding its generic megestrol acetate, which Par markets under the brand name Megace ES, in the district court, and the latter appealed immediately.
The Taiwanese company was the first drug developer to file an abbreviated new drug application with a Paragraph IV certification for the product with the US FDA.
At the time, TWi said it was entitled to 180-day generic market exclusivity, pending final FDA approval of its abbreviated new drug application.
Analysts said TWi originally planned to launch commercial sales of the drug upon obtaining FDA approval this quarter, but now the launch is likely to be delayed until the appeals court’s final verdict, which is likely to be in the first half of next year.
“Though we believe this will lead to near-term share-price pressure, we would look ahead to next year, when we still expect a major turnaround to a net profit,” as TWi is set to launch six new drugs, Daiwa Capital Markets Inc said in a separate note.
TWi shares fell 3.83 percent to end at NT$213.5 yesterday on the GRETAI Securities Market. They have underperformed the over-the-counter index by nearly 40 percent since the beginning of the year.
TWi remained in the red in the past quarter, with losses of NT$276.28 million (US$9.22 million), expanding from a net loss of NT$161.75 million in the first quarter and bigger than the average analyst estimate of NT$148 million losses, mainly due to higher operating expenses for drug development and the setup costs of the US marketing team.
In the first seven months of this year, the firm’s revenue totaled NT$188.66 million, up 81.8 percent from the same period last year.
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