![]() Endo could be expected to release an authorised generic at the same time in this situation.Īssuming an August 2014 generic launch, the NPV of Lidoderm only drops $163m, equivalent to a 3.5% drop in Endo’s market value. A settlement deal is expected, but this could still take many forms, greatly influencing the remaining value locked up in Lidoderm.Īnalysts at UBS believe it would be in Watson’s interest to settle on a later launch date, even as far back as 2014, rather than go for a 2012 launch. However this eventuality is not anticipated the small matter of FDA approval alone could well stall Watson’s ambitions. Plunging to a net present value of $395m, the loss in value equates to 11.5% decline in Endo’s market value. Generics entering next August would be the worse case scenario – which also depends on Watson winning timely FDA approval for its product – causing the value of Lidoderm to Endo to more than halve, EvaluatePharma’s Interactive NPV Analyzer shows. The alternatives are potentially losing the case completely or see Watson decide to launch at risk next year. ![]() This is a significant window, and explains why the ruling increases the pressure on Endo to come to a compromise now. Sales are seen peaking next year at $816m and consensus forecasts give the product a net present value of $926m – equal to 20% of Endo’s market value.įirst-to-file Watson’s 30-month stay expires in August 2012, three years before the core patent. The product is set to remain Endo’s most valuable until then. Lidoderm’s days of patented life are numbered anyway – consensus sales forecasts currently imply generics will enter when its strongest patent lapses in October 2015. Watson could feasibly launch in August next year, so any deal is likely to emerge sooner rather than later. Both have much to gain or lose - with annual sales of $800m forecast over the next four years, the product is by far Endo’s most substantial revenue generator. This makes it more likely that a settlement will be struck between the two companies. Endo’s attempts to keep generic versions of its topical anaesthetic Lidoderm at bay in the US hit a snag yesterday, with a judge ruling in favour of challenger Watson at an early stage of the case.
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