Any hope that Teva would swiftly rebound under new CEO Kåre Schultz has been dashed, with the Israeli drugmaker predicting another steep sales decline in 2019.
The double whammy of a weak market for its generic drugs and declining sales of former cash cow Copaxone (glatiramer acetate) for multiple sclerosis caused sales to plunge 16% in the fourth quarter to $4.6bn, although Schultz’s cost-cutting drive helped trim the company’s net loss in the period to $2.9bn from $11.6bn a year earlier.
CEO Kåre Schultz
The forecast for 2019 however is for much of the same, with revenues expected to slip 8% to 10% over the year. Analysts had hoped for a more optimistic prediction from the company this year, but Schultz now says that 2019 will be the ‘trough’ for the company, with a better outlook from 2020.
The reality for Teva is that new products have not been able to step into the breach left by Copaxone’s decline in North America and Europe, where sales fell 44% to $536m and 24% to $118m, respectively.
Meanwhile, generic sales were down 10% to $1.1bn in North America, mainly due to competition for Teva’s authorised generic of Janssen’s attention-deficit hyperactivity disorder drug Concerta (methylphenidate), and fell 9% to $844m in Europe as a result of pricing pressure.
To reverse the trend, Teva needs new products such as migraine prevention therapy Ajovy (fremanezumab) and Austedo (deutetrabenazine) for tardive dyskinesia and chorea associated with Huntington’s disease to ramp up quickly. However, both face competition in the marketplace, and Teva doesn’t have much in the late-stage pipeline to provide additional options.
Ajovy has a particularly tough time as it will compete head-to-head with similar CGRP inhibitor products from Amgen/Novartis and Eli Lilly already on the market, with others from the likes of Alder Biopharma in late-stage development.
It only picked up FDA approval last September, and made $6m in the last quarter of the year, although Teva is predicting sales will advance to around $150m in 2019. For comparison, Amgen said it made $95m in fourth-quarter sales from first-to-market Aimovig (erenumab) in the US, and analysts have suggested that could increase to almost $500m this year. Novartis – which has ex-US rights – hasn’t divulged its early sales yet.
Meanwhile, Austedo competes with a drug from Neurocrine Biosciences called Ingrezza (valbenazine), and made $204m in the year, which Teva said exceeded its forecasts. It anticipates that sales will increase to around $350m this year. First-to-market Ingrezza – which is approved for tardive dyskinesia only – saw sales reach around $410m last year.
Of the coming year, Schultz said: “we will continue to execute against our restructuring plan goals, including the optimisation of our global portfolio and network, as we focus our efforts on generating cash to reduce the company’s debt.”