NEW YORK, NY / ACCESSWIRE / October 5, 2017 / Traders had a big reason to celebrate Mylan on Wednesday after the drug's generic version of Teva's Copaxone was approved by the FDA. Generic competition for Teva's drug wasn't expected until at least 2018 so this was an early surprise. While shares of Mylan rose higher on the news, Teva's shares sank as investors grew concerned over the new competition.
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Teva Pharmaceutical Industries Limited
Teva Pharmaceutical Industries Limited's shares fell 14.56% on Wednesday with nearly 80 million shares traded. It was a gloomy day for the stock after a generic version of its MS drug Copaxone was approved by the FDA. Copaxone is Teva's blockbuster branded drug. Jefferies analyst David Steinberg wrote, "We note, the ongoing challenges to its generics business and that with FDA approval of Mylan's generic of Copaxone, earnings/cash flow are likely to [be] affected." The approval for Mylan's drug came earlier than either company had expected. There were two different doses of Mylan's version of the drug, 20 mg and 40 mg, which were approved by the FDA. The fact that the 40 mg dosage represented over 85 percent of Teva's Copaxone prescriptions in the second quarter didn't make the news yesterday any easier for Teva traders.
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Mylan N.V.'s shares closed up 16.20% on Wednesday with nearly 37 million shares traded. The stock sprang to life after the Food & Drug Administration approved the company's generic multiple sclerosis drug, Glatiramer Acetate. The drug is a generic version of Teva Pharmaceutical's multiple sclerosis treatment Copaxone. The company said it would begin shipping Glatiramer Acetate 40 mg/mL for 3-times-a-week injection and 20 mg/mL for once-daily injection immediately. While traders celebrated the news, Wells Fargo Securities senior analyst David Maris called the breakout "a little bit exaggerated" when speaking to CNBC. According to Maris, the generic Copaxone 40 mg could contribute about $0.13 in earnings per share per quarter. He wrote in a note however that "it may be unrealistic to assume a quick share shift given the patient population and the nature of the disease. It will bear close watching whether the market converts to a new player, or like in the case of the 20 mg, Teva is able to maintain a good amount of share." Copaxone made $4 billion for Teva in 2016.
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