Novartis as the next-gen pharmaceutical company? …It's possible.
I've mentioned Novartis several times here, and they are an interesting company in the way they're going about handling the generic drug market. With their acquisition of Sandoz, they've inherited an established generic drugmaker, but on the other hand, they've got their established "big company" infrustracture with all of its advantages and disadvantages. (Huge manfacturing capability and staying power, but lacking in agility.)
I've talked a lot about the Hatch-Waxman act and its 180 day exclusivity clause for the first generic drugmaker to file an ANDA with the FDA. In Novartis's case, they have the ability to basically hand their name-brand drug that has a patent expiring off to their generics division more effectively than an outsider could theoretically duplicate a drug. In theory, Novartis could file an ANDA the day after their brand-name drug was approved, which would mean that they'd be granted that extra 180 day window some ten years down the road. Their little ace-in-the-hole.
This would allow them to skip creating an "authorized" generic if they chose. Authorized generics are exactly the same as their brand-name drugs, and can be sold during that 180 day window — which of course drives the generic manufacturer batty because they don't quite have that total monopoly. This, of course, cuts into their profits, for reasons I've elucidated before.
By owning their own generics arm, Novartis can keep their drugs "in the family" with no competition for that 180 days. They simply choose not to license an authorized generic, and have their Sandoz arm be the first to the punch with an ANDA, which is relatively trivial because the drug was developed in-house.
The remaining questions are whether this is a violation of current anti-trust law, and can Sandoz compete as an agile player on the fast-moving, cutthroat generic drug turf now that it's owned by a giant company?
(This post was inspired by an article at Fool.com, whose author didn't quite connect the dots to my satisfaction.)
[tags]Medicine, pharmacy, Novartis, Sandoz, antitrust, generic drugs, Big Pharma[/tags]
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[...] I really can't wait to see what (if anything) Novartis does with their Sandoz unit in protecting their intellectual property investments from fast-moving, hard-driving competition from generic hardballers like Teva. [...]
Pingback by Teva gets generic Zoloft OK (and Lexapro, too!) :: OnThePharm — July 1, 2006 @ 7:40 pm
[...] Take for instance, Celexa. We carry the Inwood brand generic which is the "authorized" generic. It's actually made by Forest, and the Inwood bottle even says it's made by Forest. I showed the patient the tablets (virtually identical, the numbering was slightly different), showed her the bottle ("See? They're both made by Forest.") and I still got the same response: "I'll talk to my doctor first." [...]
Pingback by Physicians score worse than consumers when it comes to generic drug knowledge :: OnThePharm — August 5, 2006 @ 3:32 pm