Mylan cuts sales forecast as pricing pressure grows
- Mylan N.V. no longer expects to launch generic copies of the blockbuster asthma drug Advair or multiple sclerosis medicine Copaxone this year, a delay which led the specialty pharma to cut its revenue forecasts for 2017.
- Shares in Mylan initially fell more than 4% Wednesday morning as investors digested the guidance cut and a 9% drop in revenues from North America for the second quarter.
- Acquisitions boosted net sales in the region by $151 million during the period but lower generic prices and stepped-up competition to Mylan's flagship EpiPen Auto-Injector more than offset the inclusion of new businesses.
GlaxoSmithKline plc's Advair (fluticasone/salmeterol) and Teva Pharmaceutical Industries Ltd.'s Copaxone (glatiramer acetate) are major drug franchises, each earning billions a year despite competition in both therapeutic areas.
Novartis' Sandoz unit already markets a generic to the 20 mg version of Copaxone, but Mylan has hoped to be among the first wave of copies to the 40 mg version — a brand that earned $3.3 billion in U.S. sales the year ending November 30, according to IMS Health data cited by Mylan.
Mylan's Advair copy, on the other hand, was rejected by the Food and Drug Administration in March, stymieing an effort by the drugmaker to win the first approval for a generic to GSK's leading respiratory drug. Delay in securing an approval underscores the added difficulty of copying a drug and device combination like Advair.
Mylan, though, remains optimistic. Company president Rajiv Malik said on Wednesday's earnings call that the FDA will not require any further clinical or device-related studies for the Advair copy — a comment likely behind Mylan stock's recovery from early morning losses. Mylan plans to submit a response to the regulator's Complete Response Letter in the coming weeks, Malik said.
Continued delays in launching the two high-profile generics, however, means there is little to distract investors from a tightening price environment in the U.S. Mylan expects prices to decline by mid-single digits globally and by high-single digits in the U.S.
Declining sales of EpiPen, driven by competition and the launch of Mylan's authorized generic, present another challenge, even as the company continues to face scrutiny for steeply increasing the allergic reaction med's price.
One bright spot for the company this year might come in its biosimilars business. An advisory panel to the FDA unanimously supported approval for Mylan's biosimilar version of Roche's Herceptin (trastuzumab), likely setting up eventual approval for the biologic copy. Other biosimilars, including a version of Amgen's Neulasta (pegfilgrastim), are also in development.
- Mylan Earnings Statement
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