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Teva to pay $85M in opioid case settlement; Trump to force drug cost disclosure


Essential IR Insights Newsletter Fall - 2023

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Teva to pay $85M in opioid case settlement; Trump to force drug cost disclosure

Top news

* Teva Pharmaceutical Industries Ltd. is paying $85 million to settle an opioid lawsuit with 0Oklahoma. Oklahoma Attorney General Mike Hunter sued units of Teva, along with other major drugmakers Purdue Pharma LP, Johnson & Johnson and Allergan PLC, in 2017 for allegedly misrepresenting the risks of prescription opioid painkillers that helped fuel the U.S. opioid epidemic, seeking more than $20 billion in damages.

The Israel-based maker of generic drugs denied its involvement in the opioid crisis and noted that the settlement "does not establish any wrongdoing" by the company.

* U.S. President Donald Trump is expected to announce an executive order sometime this week that will require players in the healthcare sector to disclose the list price of prescription medicines to the public, The Wall Street Journal reported, citing people familiar with the discussion.

* Another win for gene therapy with the approval of Novartis AG's spinal muscular atrophy treatment Zolgensma will likely pose a threat to the disease's only other approved treatment, Biogen Inc.'s Spinraza. The U.S. Food and Drug Administration cleared the costly drug a week ahead of its expected decision date. Its price, a topic of much debate and discussion in the months leading up to the FDA approval, will be $2.1 million total, or $425,000 a year for five years.

* Morris & Dickson Co. LLC, a Shreveport, La.-based wholesale pharmaceutical distributor, agreed to pay the U.S. government $22 million in civil penalties to settle claims that it failed to flag more than 12,000 suspicious retail pharmacy orders for opioids hydrocodone and oxycodone, Reuters reported. Morris & Dickson said the settlement is "not an admission of liability" and the company is "working even harder to reduce the possibility of medicine ending up in the wrong hands."

On the policy front

* Norway's sovereign wealth fund will no longer invest in cannabis-linked companies, said Thomas Sevang, a spokesman for the fund's manager, Norges Bank Investment Management. Norwegian police and some politicians have lashed out on the fund for having shareholdings in companies with direct exposure to the cannabis sector, but the fund did not reveal whether the stakes had been sold, Reuters reported, citing Norwegian paper Dagens Næringsliv.

* Regulatory changes and strategic M&A are among six key risk categories in the healthcare and pharmaceutical sector, according to a special report by Fitch Ratings. Authors of the report cited megadeals like Bristol-Myers Squibb Co.'s acquisition of Celgene Corp. and proposals such as Medicare for All as potential negatives for credit profiles.

M&A and capital markets

* BridgeBio Pharma Inc. filed a Form S-1 for a proposed IPO of up to $225 million of its common stock. The Palo Alto, Calif.-based biopharmaceutical company, which is focused on developing treatments for genetic diseases, seeks to list its shares on the Nasdaq Global Market under the ticker BBIO.

* Bristol-Myers has extended the expiration date of offers to exchange notes issued by Celgene for up to $19.85 billion of new notes and cash. The New York-based pharmaceutical giant started the exchange offers in connection with its acquisition of Celgene for $95 billion.

Drug and product pipeline

* The U.S. FDA approved a combination of Novartis' Piqray and endocrine therapy fulvestrant to treat certain men and postmenopausal women with hormone receptor-positive, human epidermal growth factor receptor-2 negative breast cancer. The company's Piqray tablets were approved to be used in combination with FDA-approved fulvestrant, which is sold by AstraZeneca PLC as Faslodex.

* The U.S. FDA approved Incyte Corp.'s Jakafi as the first treatment for acute graft versus host disease, a complication of a stem cell transplant in patients at least 12 years old. The condition occurs after stem cell transplants when the donated cells start an immune response and attack the transplant recipient's organs.

* Pfizer Inc. said its drug Lyrica failed to reduce the frequency of seizures in certain epilepsy patients during a late-stage study. The 12-week phase 3 study was evaluating the drug against placebo as an additional therapy for epilepsy patients ages 5 to 65 years with primary generalized tonic-clonic seizures.

Operational activity

* Citing risks to its reputation, JPMorgan Chase & Co. asked Purdue Pharma to find a new banking partner as the pharmaceutical company faces thousands of lawsuits over its alleged role in fueling the U.S. opioid crisis, Reuters reported. JPMorgan previously managed Purdue's cash and bill payments through its commercial bank.

* Dynavax Technologies Corp. will lay off about 37% of its U.S. workforce as part of an organizational restructuring to focus on the commercialization of its hepatitis B vaccine Heplisav-B. Dynavax also plans to explore strategic alternatives for its immuno-oncology portfolio as part of the restructuring.

* MiMedx Group Inc. said an investigation by its audit committee found "extensive misconduct" by its former top executives related to matters of certain sales and distribution practices, among others.

The day ahead

U.S. markets are closed today on account of Memorial Day.

In Asia, the Hang Seng declined 0.24% to 27,288.09, while the Nikkei 225 was up 0.31% to 21,182.58.

In Europe, around midday, the FTSE 100 was up 0.65% to 7,277.73, and the Euronext 100 was down 0.19% to 1,040.74.

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