Is Teva Positioned to Compete with the Likes of Mylan and Novartis?
In 2Q16, the generic pharmaceutical industry witnessed YoY (year-over-year) price erosion of around 4% in the US and 5% globally.
Teva Pharmaceutical Industries accounts for 18% of the US generic drug market. This share is significantly higher than those of Mylan, Novartis, and Pfizer.
As one of the early entrants in biosimilars, Teva Pharmaceutical Industries (TEVA) has managed to become one of the biggest players in the biosimilar space.
In addition to its generic pharmaceutical business, Teva Pharmaceutical also has a significant presence in the major categories of the OTC drug business.
Excluding API sales, in 2016, Teva Pharmaceutical Industries is expected to earn about 50% of its net sales from the North American market.
In addition to its robust strategy, Teva Pharmaceutical also boasts of an extensive presence across all levels of the value chain for its generics business.
Teva Pharmaceutical Industries plans to take advantage of market dynamics and unmet demand in generic pharmaceuticals by enacting a three-pronged strategy.
Of the 32 brokerage firms covering Teva Pharmaceutica, 77.4% of analysts gave it a “buy” recommendation, while 22.6% gave “hold” recommendations.
After the acquisition of Allergan’s generics business and divestitures, Teva Pharmaceutical has become a leading player in the global generic industry.
Since June 2015, Teva Pharmaceutical has traded at discount valuations compared to Novartis and Pfizer but at premium valuations compared to Mylan.
Out of 25 brokerage firms surveyed by Bloomberg, ~44% of them gave Johnson & Johnson a consensus rating of “buy.” JNJ was rated “hold” by ~56% of analysts.
On September 22, JNJ’s stock was trading ~3.3% above its 52-week low of $89.9 on September 28, 2015, and ~5.2% below its 52-week high of $126.1 on July 20.
On September 19, Acclarent, a subsidiary of Johnson & Johnson, launched Acclarent Aera, a eustachian tube balloon dilation system, in the US.
On September 21, 2016, the FDA approved Jannsen Pharmaceuticals’ Invokamet XR for the treatment of adults suffering from Type 2 diabetes.
On September 16, 2016, Johnson & Johnson announced the acquisition of Abbott Medical Optics, a subsidiary of Abbott Laboratories, and its stock fell ~0.3%.
Mylan (MYL) reported an 8% rise in revenues to ~$2.6 billion in 2Q16, as compared to ~$2.4 billion during 2Q15.
Mylan’s commercial developments include the acquisition of Renaissance Acquisition Holdings’ tropicals business and the acquisition of Meda Aktiebolag.
Mylan’s 2Q16 revenues were mainly driven by 4% growth at constant exchange rates in its Generics segment, which reported a rise to $2.14 billion in 2Q16.
Mylan’s Speciality segment reported a rise of 33% in revenues to $402.5 million during 2Q16, as compared to $301.9 million during 2Q15.
Mylan has hiked the price of EpiPen by a staggering ~500% to the present price of over $600 for a pack of two auto-injectors.