LONDON (Reuters) - The arrival of cheap generic versions of GlaxoSmithKline’s top-selling lung drug Advair has moved a step closer with confirmation from Mylan that it has submitted a generic version for approval.
Mylan said late on Monday it had filed an abbreviated new drug application to the U.S. Food and Drug Administration in December.
If its product is approved under a standard review period, a generic version of Advair that may be routinely substituted for GSK’s medicine could be launched in 2017, analysts believe.
That should not come as a huge surprise to investors, since GSK’s own long-term guidance already assumes U.S. Advair sales could fall to 300 million pounds ($435 million) in 2020, from 1.97 billion in 2014, if substitutable generics are launched.
But Jefferies analysts said Mylan’s announcement had crystallized this key threat at a time when GSK is looking for a recovery in 2016.
“Whilst already partially factored into longer-term expectations, this is not reflected in mid-term consensus and represents downside risk, putting further pressure on management in a key recovery year,” they said in a research note.
GSK shares were little changed in early trading on Tuesday.
Novartis’ Sandoz unit is also working on a generic copy of Advair and the arrival of such cut-price versions is likely to add to price pressures across the respiratory market, affecting similar products such as AstraZeneca’s Symbicort.
Reporting by Ben Hirschler; Editing by Susan Fenton