Is the Amgen patent challenge on Alexion’s Solaris that big of a deal??

The recent patent challenge by Amgen has not brought a lot of good news for Alexion pharmaceuticals. Alexions shares have dropped by more than 15% since the news was announced that the US Patent Office would review key patents behind Solaris, the key drug for Alexion that made up 88% of Alexions sales in 2018.

SVB Leerink analysts updated Amgen’s patent challenge to a 50% success rate with an additional 8-12% ‘incremental erosion’ to Solaris sales beyond 2022, when Amgens biosimilar challenger would likely hit the markets.
JP Morgan Analyst, Cory Kasimov, called the investor reaction overblown. As well as stating that in the worst case scenario, Amgens biosimilar would come on the market in 2022, which gives Alexion more than enough time to switch patients to Ultomiris.

Alexion is already ahead of the game because as of July around 40% of Solaris patients have switched to Ultomiris, putting Alexion well on track towards its planned 70% conversion rate by 2020. Ultomiris already has a Solaris matching approval as well as a cheaper price than the older drug.

Another plus for Ultomiris is that even if Alexion has a setback in meeting its conversion plans, Solaris still has orphan drug designations that would secure US exclusivity in certain conditions until later dates such as neuromyelitis optica (NMO) unit mid 2026.

Ultomiris which is seeking approval in NMO, could launch in this indication as soon as 2022, giving Alexion and even better chance of switching patients away. For an Amgen biosimilar to make a real challenge the copycat will have to be at an extremely compelling price that could be daunting to achieve.

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