NEW YORK (Reuters) - The top executive of Teva Pharmaceutical Industries Ltd TEVA.O said on Tuesday that there was a “very good chance” of U.S. legislation passing next year that would pave the way for generic versions of biotechnology drugs.
The U.S. Congress has yet to approve a regulatory pathway for generic biologic medicines, which are based on living organisms and are more complex and expensive to manufacture and more difficult to duplicate than traditional chemical pills.
But many industry observers believe momentum is behind such a law, especially as President-elect Barack Obama looks for ways to cut healthcare spending.
“I think we have a very good chance of a biologics bill in 2009,” Bill Marth, CEO of Teva North America, said in an interview on Tuesday.
Marth said he thought the Obama administration believed in the legislation. “The question will be what’s going to be up first for the Obama administration,” he said.
The main sticking point in the legislation has been the amount of exclusivity that would be afforded to brand-name biotech drugs, Marth said.
Generic drug makers like Teva want to keep it to seven years, while the main biotech trade organization wants 14 years, he said.
“The toughest one to negotiate will be the exclusivity, that’s for sure,” Marth said.
But he said: “I think everything in the legislation itself can be worked out.”
Merck & Co (MRK.N) and several other large pharmaceutical companies have made waves in recent weeks by saying they would invest in generic biologics, but Marth said he was not worried about their potential involvement in the legislative process. Nor has it changed Teva’s biogenerics strategy, Marth said.
“We compete with Big Pharma all the time, so we welcome the competition,” Marth said.
Indeed, Marth said Big Pharma’s involvement could help assuage concerns about whether the generic versions are equivalent to the brand-name biotech medicines.
“Big Pharma getting into something like a generic biologic just makes it all the better,” Marth said. “It’s pretty difficult for them to be saying that generics aren’t the same at the same time they’re doing the generics.”
Israel-based Teva, the world’s largest generic drug maker, has added to its biogeneric capabilities with its $7.46 billion acquisition of New Jersey-based Barr Pharmaceuticals. The deal closed on Tuesday.
The two companies, which generated a combined $13.6 billion in revenue for the 12 months through September, have created a generic-drug powerhouse with a bigger U.S. and European presence.
Marth said investors have had a tougher time seeing the benefits of adding Barr’s business of brand-name women’s health products, which include several contraceptives.
Marth said his goal would be to increase the women’s health business’ annual sales to $1 billion from a range of $500 million to $600 million currently, although he acknowledged that will take time.
“We think that there’s a lot of growth in women’s healthcare over the next few years,” Marth said.
One Barr product in particular that he said was “underappreciated” is Paragard, an intrauterine contraceptive.
“We think Paragard is an excellent product,” Marth said. “We need to get that out there on the street, get that understood and marketed.”
With Barr, Teva has nearly 24 percent of the U.S. generic prescriptions market.
“I’d still like to increase my share in the U.S. market,” Marth said. “We still think that there is some room to do that, but we can do a lot of that organically.”
Editing by Lisa Von Ahn