DID - July 21, 2008 Issue

July 21, 2008  |  Vol. 7 No. 141

Teva Buying Barr in $9 Billion Cash, Debt Deal

Israel-based generic drug company Teva Pharmaceutical is acquiring Barr Pharmaceuticals, the fourth-largest generic drug company in the world, the companies say in a joint statement.

Teva has agreed to pay $7.46 billion in cash and stock and to assume Barr’s net debt of approximately $1.5 billion. The Israeli company expects the transaction to close late this year, posting earnings in the fourth quarter. The purchase price represents a premium of 32 percent on Barr’s average daily closing price on the New York Stock Exchange for the year ending July 16 and a 42 percent premium on that day’s closing price, according to the companies.

Teva says the acquisition will strengthen its position in the U.S. and Europe, expanding its generic and proprietary offerings as well as its biologic product line. The combined company will operate directly in more than 60 countries and employ approximately 37,000 people worldwide. The companies’ 2007 combined revenues were about $11.9 billion.

The combined company will have more than 500 marketed products, more than 200 ANDAs pending with the FDA, annual brand sales of more than $120 billion and approximately 3,700 product registrations pending with regulatory authorities worldwide, primarily in Europe.

The boards of directors of both companies have unanimously approved the transaction. The acquisition is subject to approval by Barr’s stockholders, antitrust notification and clearance in North America and Europe, and other customary conditions.

The agreement may be terminated under certain circumstances — for example, Barr’s board of directors could accept a better, unsolicited offer before approval of the merger by the company’s stockholders. If the merger agreement is terminated under some circumstances, Barr would have to pay Teva a termination fee of $200 million.

Lehman Brothers acted as financial adviser to Teva in this transaction, Willkie Farr & Gallagher provided external legal counsel for Teva, Banc of America Securities acted as financial advisor to Barr, and Simpson Thacher & Bartlett provided external legal counsel for Barr. — Martin Gidron

 

Zentiva Board Rebuffs Sanofi’s Takeover Offer

The board of Czech generics maker Zentiva has asked the company’s shareholders to reject an unsolicited voluntary takeover offer from sanofi-aventis, saying it does not reflect the underlying value of Zentiva and its future prospects.

Sanofi-aventis Europe, a wholly owned subsidiary of sanofi-aventis, offered to buy Zentiva shares for $72.14 per share.

The Zentiva board said the offer is inadequate. The company expects strong sales in the Turkish, Russian and Ukrainian markets and anticipates revenue growth of about 20 percent, Zentiva said.

Zentiva also expressed concern that the sanofi offer did not present obvious, tangible benefits for the company’s employees, customers and business partners.

Last month, the Zentiva board recommended that shareholders reject an unsolicited $61.40-per-share takeover offer from Cyprus-based Anthiarose, calling it “opportunistic and vague.” The sanofi offer represents a 10.5 percent premium, at current exchange rates, to the Anthiarose proposal. But it may require Zentiva to divest itself of certain assets, Zentiva said.

Sanofi has taken note of Zentiva’s announcement and continues to say its offer is in the best interest of shareholders. The company said its price “reflects the fair value of the company,” according to sanofi spokesman Jean-Marc Podevin.

Sanofi’s offer was made July 11 and remains valid through Sept. 19. — Elizabeth Jones

 

Generic Plavix Hits Snag in Germany

Swiss generics maker Cimex, a division of Schweizerhall Group, will have to wait to launch its generic version of the blockbuster antiplatelet medication Plavix since sanofi-aventis has challenged the copycat drug’s German approval.

The delay was revealed in a Novartis earnings call last week when Andreas Rummelt, the CEO of Sandoz, Novartis’ generics unit, said he did not know the timeline of Schweizerhall’s European launch of generic Plavix (clopidogrel bisulfate) because German regulators had withdrawn the drug’s marketing authorization per sanofi’s request. Sandoz and another company reportedly will market the generic.

The regulator’s decision will affect the generic’s launch in both Germany and other European countries, Rummelt added.

Cimex had received final approval in May from Germany’s Federal Institute for Drugs and Medical Devices for a generic version of Plavix, which sanofi markets with Bristol-Myers Squibb (BMS).

Cimex and Schweizerhall have requested accelerated court proceedings to achieve a quick execution of the approval, which they expect in a few months, Schweizerhall said.

Schweizerhall estimates the annual European market for clopidogrel to be $3.07 billion with Germany accounting for $575 million (DID, May 12). Worldwide sales of the drug were approximately $1.3 billion in the first quarter of 2008, an increase of 39 percent over the same period last year, according to BMS. — Elizabeth Jones

 

FDA Launches Fellowship Program

In an effort to attract more scientific talent to the FDA, the agency is launching a two-year fellowship program designed to train scientists and engineers on the scientific foundations of its regulatory actions. 

The program will start in October, and the agency is considering applicants for 30–40 slots in the first entering class. Applicants must have a doctoral degree in medicine or another scientific field or at least a bachelor’s degree for engineering positions.

“To fulfill our mission over the coming decade, we will need to recruit thousands of highly skilled scientists and others with specialized and relevant expertise,” Frank Torti, principal deputy commissioner and chief scientist, said.

“The FDA Commissioner’s Fellowship Program is designed to attract these people to the FDA and provide them with in-depth knowledge of the science that underpins regulatory decisions as we meet the challenges of both globalization and rapid changes in science and technology,” he said.

Torti recently was named the first chief scientist at the FDA and is tasked with launching the program. He was a fellow of medical oncology at Stanford and has designed and executed multiple cancer clinical trials, contributing to the understanding of molecular mechanisms underlying inflammatory diseases and cancer (DID, April 10).

In the first semester of the program, fellows will focus on a special research project under the guidance of an FDA scientist. Fellows will spend 70 percent of their time in the program working on their research projects and 30 percent on coursework. — Christopher Hollis

 

CBER Guidance Addresses Trial Design for IGIV Products

A statistical demonstration of a serious infection rate of less than 1 per person-year is adequate to provide substantial evidence of efficacy in clinical trials of investigational human immune globulin intravenous (IGIV) products, CBER says.

Sponsors of IGIV products may be able to run pivotal clinical trials using various types of designs, CBER says in a new guidance, which finalizes a draft guidance released in November 2005.

IGIV products are used as replacement therapy for primary humoral immunodeficiency. They are prepared from large pools of plasma collected from numerous individual healthy donors, so they contain antibodies against many infectious agents.

At an FDA Blood Products Advisory Committee meeting in 1999, the agency suggested a pivotal trial design using a prospective, randomized, double-blind, parallel, positive control, noninferiority study in 80 subjects with a documented history of primary humoral immunodeficiency in which the safety and efficacy of the test product would be compared with that of a U.S.-licensed IGIV product. Sponsors were advised to evaluate efficacy by comparing the serious infection rate in each group over a year’s time.

Since then, CBER has determined that other approaches may work. For example, it suggested alternative clinical trial design proposals involving testing in fewer subjects in an open-label, single-arm trial compared with a statistically modeled historical control might be sufficient to provide evidence of safety and efficacy.

The guidance outlines how sponsors are to conduct pharmacokinetic studies to describe the distribution, metabolism and elimination of IGIV products for a BLA. Data from the studies would provide a basis for historical comparison between the investigational IGIV product and licensed IGIVs and help determine the optimum dosing schedule.

CBER recommends that sponsors obtain pharmacokinetic data from at least 18–20 adult subjects with primary humoral immunodeficiency, regardless of prior treatment. The guidance also details how to conduct pharmacokinetic studies in children.

Safety and Efficacy Principles

CBER advises sponsors of IGIV trials to study a minimum of 30 subjects at the highest dose to be recommended in the product’s labeling, to capture adverse events that occur with a frequency of 10 percent or more.

It is important for protocols to define and capture all adverse events associated with the use of the product, regardless of whether the investigator thinks the event is product-related, the guidance says. The protocol should define criteria for determining whether an AE is temporally linked with an infusion. Adverse events should be listed individually by body system with subject identification numbers. The numbers of events that occur within one hour, 24 hours and 72 hours following infusion of the test product should be tallied separately.

For safety reasons, the protocol should provide explicit directions for starting and adjusting infusion rates, including the time frames for incremental changes and the size of infusion rate increments.

CBER considers real-time subject diaries to be important source documents for complete adverse event data. Sponsors are advised to provide an explanation for discrepancies between diary entries and case report form entries made by the clinical investigator, subinvestigators or other staff.

CBER discourages premedication in clinical trials designed to evaluate the safety of biologic products, except when subject safety is at stake. In such instances, sponsors should keep records of the use of any premedications and their possible impact on the study data, and evaluate their possible impact in the final study report, the guidance says.

To evaluate the efficacy of an investigational IGIV, CBER recommends that clinical trials compare the frequency of serious bacterial infections among patients taking the test product regularly with a historical standard or a control group over a year’s time to avoid seasonal biases. Sponsors also are advised to:

  • Discuss plans for pediatric studies with the reviewing division at the IND stage;
  • Prospectively provide specific diagnostic criteria for each type of serious infection to be included in the primary efficacy analysis in the protocol. “Diagnostic criteria should not be overly restrictive so that you capture all infections of interest. Clinical investigators at different sites should use uniform diagnostic criteria,” CBER says;
  • Prospectively define the study analyses in the protocol. CBER expects the data analyses presented in the BLA to be consistent with the analytical plan submitted in the IND;
  • Enroll about 40–50 subjects;
  • Provide in the BLA descriptive statistics for the number of serious infection episodes per person-year during the period of study observation, a frequency table giving the numbers of subjects with serious infections, a description of each serious infection and summary statistics for the length of observation of each subject; and
  • Obtain and analyze secondary endpoints, including candidate surrogate efficacy endpoints.

The guidance can be accessed at www.fda.gov/cber/gdlns/igivimmuno.htm. — Martin Gidron

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Reporters: Martin Gidron, April Astor, Christopher Hollis, Elizabeth Jones

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