Actavis Barred from Selling Generic Pulmicort Respules - Analyst Blog

Zacks Equity Research

Updated Wed, Feb 18, 2015, 6:45 PM

Actavis plc (ACT) announced that the U.S. Court of Appeals for the Federal Circuit has issued a temporary injunction prohibiting the company from further distribution of its generic version of AstraZeneca's (AZN) Pulmicort Respules (0.25 and 0.5 mg) until the court reaches a final decision on AstraZeneca's appeal for an injunction.

Sales of generic Pulmicort have been prohibited pending a hearing on the temporary injunction, which is due Feb 20, 2015. Moreover, the temporary restraining order does not include the product shipped prior to its issuance.

We remind investors that last week the U.S. District Court for the District of New Jersey had ruled the patent (Patent No. 7,524,834) protecting AstraZeneca’s Pulmicort Respules in the U.S. as invalid and denied the company’s request for a permanent injunction. The court’s decision cleared the way for Actavis to immediately launch its generic version of the drug.

Pulmicort Respules is approved as a maintenance treatment to control and prevent asthma symptoms in children aged between 12 months to 8 years.

We believe the news of the temporary injunction on Actavis’ generic Pulmicort Respules is disappointing considering the drug’s market share in the U.S. The drug recorded annual branded and generic sales of approximately $1.1 billion in the U.S. as of Jun 2014.

Currently, Teva Pharmaceutical Industries Ltd.’s (TEVA) generic Pulmicort Respules is the only generic available in the market following its licensing agreement with AstraZeneca.

Actavis currently carries a Zacks Rank #2 (Buy). Another favorably ranked stock in the health care sector is Impax Laboratories Inc. (IPXL) carrying a Zacks Rank #1 (Strong Buy).

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ACTAVIS PLC (ACT): Free Stock Analysis Report

ASTRAZENECA PLC (AZN): Free Stock Analysis Report

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Actavis Barred from Selling Generic Pulmicort Respules - Analyst Blog

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