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Mylan’s Tecfidera generic launch jolts Biogen, putting billions at stake

Despite Biogen’s intense effort to defend its big-selling multiple sclerosis drug Tecfidera, Mylan has cleared several hurdles to launch a copycat, and now it’s doing just that.

After an early FDA approval for its generic on Monday, Mylan said Wednesday it’d launch, even at risk of damages should it eventually lose in patent court. The Tecfidera copycat is the first oral multiple sclerosis generic to reach the market.  

The launch is “another prime example of Mylan’s fundamental commitment to bringing more access to patients worldwide,” Mylan CEO Heather Bresch said in a statement.

At the same time, the rollout “adds new uncertainty” to the Biogen story, Jefferies analyst Michael Yee wrote in a note to clients. Tecfidera’s performance for this year and next are “now very murky,” Yee pointed out, warning that the company could miss consensus revenue estimates for the medicine this year. Analyst estimates for next year “could start to go all over the place,” he added.

Still, the pricing impact “may not be drastic” right away as Mylan stands to be the only generic on the market initially, Yee wrote.

The generic launch comes after Mylan prevailed in a patent fight against Biogen in West Virginia federal court. In a June decision, Judge Irene Keeley said Mylan “demonstrated by clear and convincing evidence” that certain claims of Biogen’s ‘514 patent are invalid for “lack of written description.” The patent was set to expire in 2028, so the decision will erode years of potential exclusivity if it’s upheld.

Biogen has pledged to appeal, meaning Mylan is now rolling its drug out “at risk” as the appeal plays out. If Biogen wins on appeal, Mylan could be forced to pay damages of up to triple the amount of the branded drugmaker’s lost revenue.

On a conference call last month, Biogen CEO Michel Vounatsos said the company was “disappointed” with the patent decision and would “vigorously defend” its intellectual property. On Wednesday, a spokesman for the company said Tecfidera’s safety and efficacy profile has been “affirmed by the hundreds of thousands of people living with MS who have chosen” the treatment.

Aside from Biogen’s patent appeal, an upcoming decision on a “collateral estoppel decision” could allow other generics players to launch, Piper Sandler analyst Christopher Raymond wrote in a note to clients. That could come “within the next couple of weeks” and would dramatically affect the market going forward.

Tecfidera generated $1.18 billion for Biogen during the second quarter alone, or about 32% of the company’s total revenues. With the loss of exclusivity, the company will have to switch gears to focus on follow-up Vumerity, which hasn’t yet taken off. The med generated just $9 million during the second quarter.

Outside of multiple sclerosis, spinal muscular atrophy drug Spinraza and controversial Alzheimer’s drug candidate aducanumab are key meds for the company going forward. But both face their own challenges.

Spinraza, the company’s second-best selling medicine behind Tecfidera, faces new competition from Roche’s Evrysdi, the category’s first entrant that can be administered at home rather than at a clinic. Aducanumab is under FDA review with a decision expected in March, and analysts are far from certain it will win approval. Some analysts put the drug’s chances at an OK in the 30% range, with 55% odds on the high end.