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Teva scales back R&D as Copaxone competition looms

Copaxone accounts for almost 40% of its revenue

Teva Pharma logo

Teva is dropping its R&D programmes in cancer and women's health in order to focus on central nervous system and respiratory diseases.

The Israeli company says it intends to trim around $150m off its R&D budget next year, rising to $200m in 2016 and 2017, just as it starts to face generic competition to multiple sclerosis blockbuster Copaxone (glatiramer acetate), which accounts for almost 40% of the company's revenues.

Copaxone sales slid 12% to $939m in the second quarter of the year, even before the start of generic competition in the US market where it lost patent protection in May. A lawsuit lodged by Teva to try to restore Copaxone's earlier patent expiration date of September 2015 is due to be heard in the Supreme Court next week.

Some of the savings accrued from the R&D restructuring will be ploughed back into Teva's CNS and respiratory programmes, while some will go towards meeting Teva's earlier-stated objective of cutting costs by $2bn in 2017.

Teva's chief executive Erez Vigodman - who took the helm of the company earlier this year - said that the bulk of the 30 or so product launches planned between now and 2019 are in the CNS and respiratory categories, including reslizumab for severe asthma and laquinimod for MS. All told, these projects have combined annual sales potential of around $4bn, he added.

"Teva is committed to being a world-leader in CNS and respiratory, both areas underpinned by significant and growing unmet patient needs," said Vigodman in a statement.

Custirsen future?

The move means it is calling 14 pipeline projects to a halt, although it is not clear yet whether its most advanced cancer project - the clusterin blocker custirsen - is affected.

Custirsen is licensed from OncoGenex and has reached late-stage testing in prostate and lung cancer, and Teva said in its latest statement that in oncology and women's health it would "focus on market-ready or close-to-market assets to maximize sustainable profitability."

The clusterin inhibitor project suffered a setback earlier this year, however, when the drug generated disappointing results in a phase III prostate cancer trial, although it remains in two other pivotal trials. Meanwhile, Teva also has a BRAF/EGFR inhibitor and ALK/FAK inhibitor in early development that look likely to be casualties of the restructuring.

More details of the changes will be provided during Teva's third-quarter results presentation on October 30.

Article by
Phil Taylor

7th October 2014

From: Research, Sales



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