- Biosimilar maker Alvotech is strengthening its partnership with Teva Pharmaceutical and gaining $140 million in new funding, announcing Monday it has raised $40 million by selling bonds to Teva and is conducting a private placement of $100 million more. Alvotech’s largest shareholder, Aztiq Pharma Partners, has committed to buying any unsold bonds under the private placement, which will run through July 30.
- The $140 million will come in the form of “subordinated convertible bonds,” which buyers can exchange into Alvotech shares. That funding will add to a cash pile that on March 31 totaled $116 million, but has been dwindling while Alvotech struggles to bring a biosimilar version of AbbVie’s Humira to market.
- Alvotech had been poised to launch its Humira biosimilar in the U.S. on July 1. But the Food and Drug Administration has rejected its applications three times due to deficiencies at a manufacturing plant in Iceland.
In the first quarter of 2023, Alvotech generated $16 million from sales of its Humira biosimilar in Europe and Canada, compared to $73 million in research and development as well as general expenses. Without the added revenue from a U.S. launch, the company has been in a tough spot financially, something it acknowledged upon its latest FDA rejection in June.
As part of the Teva deal, the Israel-based generics company will step in to help. The reworked partnership includes a stipulation that Teva will have “increased involvement” in the manufacturing and quality at Alvotech’s manufacturing facility, and is supporting the company on-site in Iceland to be “fully ready for an FDA inspection.”
Teva will also gain U.S. rights to two new pipeline projects as well as line extensions to two unspecified biosimilars that are already part of the collaboration. In addition to the Humira lookalike, Teva has U.S. rights to biosimilar versions of Stelara, Simponi, Eylea and one undisclosed product.
Missing the deadline to launch on July 1, which Alvotech had the right to do under a legal settlement with AbbVie, was a big setback for the company. The first marketed Humira biosimilar, Amgen’s Amjevita, launched in the U.S. in January, and several more followed in early July. Major insurers have already put products from Boehringer Ingelheim, Novartis’ Sandoz division and Amgen on their formulary, effectively closing out others from millions of patients.
Moreover, the price and resulting sales opportunities for newer Humira copycats will likely decline as competition grows.
Alvotech remains months away from its launch, as it must submit a new application to the FDA, which will then begin a six-month review.
Shares in the Iceland-based company rose 3% in late morning trading Monday.