* Novartis generics unit buys Oriel for undisclosed sum
* Targets respiratory drugs losing patent protection
* Oriel inhaler may be alternative to Vectura device
* Novartis shares ease 0.4 pct
(Adds analyst comment, background on Vectura)
By Sven Egenter
ZURICH, April 19 Swiss drugmaker Novartis AG
NOVN.VX has bought privately held U.S. company Oriel
Therapeutics to boost its generics portfolio in the
multibillion-dollar market for respiratory drugs.
The move suggests the Swiss drugmaker may see an simpler
route to market with Oriel's electronic inhaler device than with
another device from Britain's Vectura Group Plc (VEC.L), which
Novartis has been working on, analysts said.
According to industry estimates approximately 50 percent of
the current $32 billion global market segment for asthma and
chronic obstructive pulmonary disease (COPD) medicines is
expected to lose patent protection by the end of 2016, Novartis'
generics unit Sandoz said in a statement on Monday.
The segment is projected to grow significantly faster than
the pharmaceutical market, driven by factors including a
significant level of under-diagnosis.
Sandoz has made generic respiratory drugs a key area for
investment, partly via its alliance with Vectura. But last month
it handed back to Vectura U.S. rights for a drug widely believed
to be a generic version of GlaxoSmithKline Plc's (GSK.L) Advair.
"Clearly, this news (Oriel acquisition) may suggest that
Sandoz-U.S. sees an easier path for this product to get
regulatory approval as a generic device than it did for
Vectura's device," said Sam Fazeli, an analyst at Piper Jaffray
Sandoz is still working with Vectura on its product in
Sandoz has signed a definitive agreement to buy Oriel
Therapeutics, which focuses on developing respiratory products
as generic alternatives to patented drugs for asthma and other
respiratory diseases. Financial details were not disclosed.
"Oriel is a strong strategic fit with Sandoz and the
acquisition is expected to support our strategy of increasing
the number of differentiated, higher-value products in our
development pipeline," said Jeff George, Division Head Sandoz,
in a statement.
"One of our strategic objectives is to offer fully
substitutable generic versions of key branded medicines,
including respiratory medicines," he said.
The acquisition provides Sandoz with three promising
development projects targeting leading medicines in this field.
Details of Oriel's development programmes, including
anticipated timing of future regulatory submissions, are not
being given for competitive reasons, the Swiss group said.
Novartis shares eased 0.4 percent to 56.35 Swiss francs by
0818 GMT, in line with the Stoxx 600 healthcare sector index
.SXDP, while Vectura fell 1.1 percent.
(Additional reporting by Ben Hirschler in London; Editing by
Jon Loades-Carter and Michael Shields)