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Generic drug giant

Teva Pharmaceuticals

(Nasdaq:TEVA) announced on January 7 that it the Food and Drug Administration has granted it exclusive marketing rights to two drugs.

One is the 30 milligram tablets of Nifedipine, a generic version of the hypertension and angina drug Procardia made by Pfizer (NYSE:PFE). The drug is used in the treatment of hypertension and angina. Teva already held FDA approval to market 60-mg dosages of Nifedipine, obtained after much travail.

The FDA also approved Teva's Etodolac 400 milligram tablets, a generic version of Wyeth-Ayerst's anti-inflammatory drug NSAID Lodine, used to treat arthritic symptoms.

Teva announced that it will start marketing the drugs immediately.

The drug company had to overcome several hurdles before obtaining FDA approval for Nifedipine. Teva and its partner Biovail filed a Citizen's Petition to rescind the 180-day exclusivity marketing approval that was granted to drug giant Mylan for Nifedipine 30 milligram tablets following the agreement between Mylan and Pfizer. Teva and Biovail have a U.S. marketing agreement for Biovail's generic sustained-release products.

Teva CFO Dan Suesskind said that the Nifedipine 30 milligram tablet approval is very special for Teva. He explained that Mylan had marketing exclusivity for the drug for 180 days as of commencing marketing. At the end of the exclusivity period, any drug company could market a generic version of the drug.

But Pfizer tried to avert the marketing of the generic version of the drug, Suesskind said, by obtaining Mylan's consent not to begin marketing of the drug, hoping to suspend the ticking of the 180-day clock.

In presenting its case before the FDA, Teva said that the 180-day marketing exclusivity commences once the drug is commercially available. Teva argued that this applies to Mylan, even if it is not actually marketing the drug.

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The FDA accepted Teva's position that in light of Mylan's agreement with Pfizer, Mylan is not eligible for marketing exclusivity.

The U.S. brand name sales of Nifedipine 30 milligram tablets is estimated at $130 million annually.

Suesskind says Teva's triumph is an important precedent. He added that Mylan sold the drug at an especially high price.

"It is the first time we've come across a move like this, intended to stop the generic version of a drug," Suesskind said. He added that the only similar case was of a proprietary drug maker that paid a generic drug company not to market a generic version.

As for Etodolac 400 milligram tablets, used to treat arthritis, the U.S. market is estimated at $70 million annually. Teva began selling 500 mg and 600 mg dosages in September 2000, for which it won a 180-day marketing exclusivity. Its exclusivity has expired, but Suesskind says that as far as he knows, no other companies are marketing the generic version.

Oppenheimer predicts record sales volume in Q4

Teva is shortly expected to release its financial results for the fourth quarter of 2000.

CIBC Oppenheimer

believes that Teva will post a record revenue volume of $462.4 million and earnings of 38 cents per share, 19% more than the same period in 1999.

Suesskind says Teva is comfortable with the forecasts. As for the slowdown in the U.S. economy, he says investor interest in drug companies typically increases during slowdowns, because the industry is considered resilient.

The CFO added that Teva has 50 drugs in the FDA pipeline. This, he concluded, is of more moment to Teva than the temporary situation of the market.