To be fair, I wanted to include Teva's info from their latest annual report, form 20-F, from this past February. I think you will find the bolded info very interesting.
Sales of our innovative products, especially Copaxone®, could be adversely affected by competition.
Our innovative products face or may face intense competition from competitors’ products, which may adversely affect our sales and profitability. Copaxone® is our leading innovative product, from which we derive approximately 18% of our net sales and which contributes disproportionately to our profits. To date, we and our marketing partners have been successful in our efforts to establish Copaxone® as the leading therapy for multiple sclerosis and have increased our global market share among the currently available major therapies for multiple sclerosis. However, Copaxone® faces intense competition from existing products, such as Avonex®, Betaseron®, Rebif®, Extavia® and Tysabri®. We may not be able to introduce price increases at the same rate as in recent years or to offset any decrease in the rate of growth of sales. We may also face competition from additional products in development, including orally administered formulations of Gilenia®, which has recently been granted priority review status by the FDA, cladribine which is the subject of a submitted NDA and fingolimod, which have completed their Phase III trials. In addition, if our patents on Copaxone® are successfully challenged, we may also face generic competition prior to 2014, when the U.S. orange book patents covering Copaxone® would otherwise expire. In July 2008, Sandoz Inc., the U.S. generic drug division of Novartis AG, in conjunction with Momenta Pharmaceuticals, Inc., filed an Abbreviated New Drug Application (“ANDA”) with the FDA for a generic version of Copaxone® seeking approval prior to the expiration of our patents. In August 2008, we filed a complaint against Sandoz/Momenta, which triggered a stay of any FDA approval of the ANDA until the earlier of January 2011 or a district court decision (if any) in favor of the ANDA filer. On October 16, 2009, Mylan Laboratories also filed an ANDA for a generic version of Copaxone®. Any substantial decrease in the profits derived from our innovative products would have an adverse effect on our results of operations.
Remember- Copaxone represents 18% of their sales, but much more than that in their profits.
Sales:
Copaxone® reinforced its position, both in the U.S. and globally, as the leading multiple sclerosis drug, with global sales growing by 25% over 2008, reaching total global in-market sales of $2,826 million
That's a whole lot of money, folks. In fact, it is $2.8B for this single product.
Continued growth in sales of Copaxone®, which increased in-market sales by $534 million in 2009. We benefited from record in-market sales of Copaxone® in the U.S. due to price increases and, to a lesser extent, volume growth
For those keeping track with a calculator handy, that is one heck of an increase in sales- though most of it came from price increases, to be fair.
The companies overall profit margin was 53% of net sales. In other words, 53 cents out of every dollar in sales went to the pocketbooks. Remember, Teva does much more than Copaxone; however, Copaxone contributes heavily to the profit margin (as they state above).
So with that in mind, it is hard to not associate Copaxone with the following statement:
In addition, our increasing focus on innovative and specialty pharmaceuticals requires much greater use of a direct sales force than does our core generic business. Our ability to realize significant revenues from direct marketing and sales activities depends on our ability to attract and retain qualified sales personnel. Competition for qualified sales personnel is intense. We may also need to enter into co-promotion, contract sales force or other such arrangements with third parties, for example, where our own direct sales force is not large enough or sufficiently well-aligned to achieve maximum penetration in the market.
As mentioned in the Biogen post I did earlier, Copaxone is not an OTC drug. So what "third parties" and "co-promotion" could Teva be referring to?
I will stress that anyone can look up these statements. These are direct quotes from the companies themselves. Back in February, CCSVI did not have the momentum that it does now in our community. I can't wait to see their updated 20-F next year.
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