Andrx will allow Teva/Impax to launch a generic version of GlaxoSmithKline's Wellbutrin SR/Zyban (bupropion sustained-release) if FDA does not approve Andrx' ANDA within a "defined period of time."

Andrx and Teva/Impax entered into an "exclusivity transfer agreement" July 31 that will ensure that generic versions of GSK's antidepressant and smoking cessation brands are not held up indefinitely by Andrx' 180-day exclusivity.

Both Andrx and Impax have won summary judgment rulings that their generics do not infringe GSK's patents on bupropion SR.

Andrx has "first-to-file" generic exclusivity, but the company has been unable to launch pending resolution of issues surrounding blend uniformity testing (¹ Also see "Naprelan Generic Exclusivity Settled; Andrx Sees Three Near-Term Launches" - Pink Sheet, 15 July, 2002., p. 7).

Under the July 31 agreement, Andrx will continue to seek approval of its ANDA. However, "if Andrx is unable to launch its own products within a defined period of time, and Impax is able to market its products, Andrx will enable Impax to launch its own products." Teva is Impax' marketing partner for bupropion SR.

Andrx would receive "certain payments" during the first 180 days of marketing. If Andrx ends up coming to market before Impax, the companies would share "certain payments for a 180-day period." The agreement is subject to review by the Federal Trade Commission.

Andrx' decision to enter the agreement is an acknowledgement that the company is uncertain about its ability to secure a timely approval for its ANDA.

Andrx CEO Richard Lane told a July 30 quarterly conference call that the company continues to discuss regulatory issues with FDA and the U.S. Pharmacopeia. Lane also pledged to "reap the value" of the bupropion ANDA filing, even if Andrx is not first to market.

Lane's analysis of GSK's plans to defend the bupropion franchise may provide some indication of how long the "defined period of time" is that Andrx will have to try to finalize the ANDA under the exclusivity transfer agreement.

The Andrx CEO was asked how concerned the company is about GSK's plans to introduce a new bupropion formulation, Wellbutrin XL , in conjunction with Biovail.

The new formulation would not have a significant impact "over a short period of time," Lane maintained.

"Obviously, we'd like to be out as early as we can get," Lane said. However, "I believe it will take GlaxoSmithKline at least six months to establish a sufficient conversion."

"There will be a lot of factors working against them, not least of which will be managed care's desire to preserve the opportunity to convert to generics," Lane said.

In addition, "their ability to convert is going to depend on their label," Lane continued. "This may be not correct, but my understanding is that their label studies were not versus the SR formulation but in fact their label compares the product to immediate release, which could impede their ability to substitute."

In any event, "it will take them at least six months to get 30% or 40% conversion," Lane predicted. So, "as long as we launch any time within the first few months of their launch, the entire opportunity remains."

The GSK/Biovail formulation is "approvable" at FDA. Biovail maintains that only "routine" issues need to be resolved, with a launch expected during the second half of 2003 (² 'The Pink Sheet' June 30, 2003, In Brief).

"I think between now and mid-next year, a significant opportunity remains in the marketplace for our generic products," Lane said. The generic companies estimate the Wellbutrin SR/Zyban market at $1.6 bil. per year.

Andrx has successfully converted first-to-file exclusivity into a valuable royalty stream before. The company recorded $43 mil. during the second quarter from Schwarz as part of the generic omeprazole cross-licensing deal.

GSK is pursuing appeals against both Impax and Andrx. Separate oral arguments have been heard in both cases and decisions are pending (³ Also see "Wellbutrin SR Patent Cases: Did GSK Surrender Claims To Excipients?" - Pink Sheet, 9 June, 2003., p. 5).

Wellbutrin SR/Zyban Generics Will Not Be Blocked By Andrx Exclusivity

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