The US drug regulator has revoked tentative approvals it gave to Ranbaxy for launching the generic versions of AstraZeneca’s heartburn drug Nexium and Roche’s antiviral drug Valcyte in the US.
As a result, the company is expected to face a combined loss of $250 million from the loss of the six months exclusivity periods for both drugs, say analysts.
Ranbaxy said FDA has rescinded the previously granted tentative approvals for Ranbaxy’s ANDAs for esomeprazole magnesium delayed release capsules, 20 mg and 40 mg and for valganciclovir
hydrochloride tablets USP, 450 mg.
FDA has said that its original decisions granting tentative approvals were “in error” because of the compliance status of the facilities referenced in the ANDAs at the time the tentative approvals were granted,” Ranbaxy said in its statement. It said the company’s Abbreviated New Drug Applications (ANDAs) of concern did not have any data integrity issues.
Abhishek Sharma, pharma analyst, IIFL, said, “Losing out on Nexium exclusivity will cost Ranbaxy around $180 million during the six month period. The possibility to do it through third party still remains because the US FDA did not say whether the exclusivity has been forfeited or not.”
According to another pharma analyst, while Roche’s Valcyte is not a major opportunity for Ranbaxy, the same cannot be said for AstraZeneca’s Nexium.
“The US FDA has been under a lot of pressure because the generic product should have been launched a month earlier. It is a realisation that under current circumstances (the India plants that manufacture the drugs are not in compliance) and current manufacturing Ranbaxy will not be able to bring this product into the market in the near future.”
AstraZeneca was benefitting from the fact that there is no generic product in the market, there was a lot of pressure on FDA due to the revenue loss to the government because of this.” The expected loss from valcyte during during the exclusivity period is estimated around $70 million.
The analyst said Ranbaxy’s exclusivity approval on Nexium would have blocked other players to enter the market for the first 180 days, but it may now look that other generic players could get approval to maintain a level-playing field for all.
The expected Indian gainers are Dr Reddy’s Laboratories, Cipla and Aurobindo Pharma, said the analyst.
Meantime, AstraZeneca’s stock is down 2% in London. “Generic Nexium is bound to come pretty soon and that is why AstraZeneca stock is reacting but whether that is under Ranbaxy or whether Ranbaxy will sell that exclusivity to third party that we are still not very clear about,” Sharma of IIFL said.
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