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Roche and Gilead Losing Patent Protection on Top Sellers

Three Roche (RHHBY) drugs with combined U.S. sales of more than $10 billion will lose patent protection in 2020. Others facing new competition for their big moneymakers are Gilead Sciences (GILD), Pfizer (PFE), Allergan, Amgen (AMGN), GlaxoSmithKline (GSK) and Indivior (INDV). The question investors have to ask themselves is whether or not the revenue losses these companies will suffer have already been factored into their share prices, or if they have other medications that can make up the difference.


Companies with biosimilars--a generic version of a biologic drug--have their sights set on Roche's three mega blockbuster cancer drugs (Rituxan, Herceptin and Avastin), according to an article in FiercePharma.

In mid-2019, the FDA approved Pfizer's Prurience, which will compete with Roche's Rituxan. Pfizer is planning a January 2020 launch. In November, Teva and Celltrion began marketing their biosimilar Truxima in the U.S. Both new drugs will chip away at Rituxan, which brought Roche nearly $4.25 billion in U.S. sales in 2018. Rituxan sales in Europe have already been battered by competition from Truxima.

Roche isn't standing still in the face of generic competition. The company is taking steps to develop new medicines to help offset the revenue loss. Towards that end, earlier this year Roche bought gene therapy specialist Spark Therapeutics for $4.3 billion.

Gilead is also losing patent protection for three drugs that generated more than $2.6 billion in U.S. sales in 2018. They are the hepatitis C treatments Epclusa and Harvoni and the hypertension drug Letairis.

CEO Daniel O'Day doesn't seem concerned. In fact, STAT News reported that O'Day, who took over the CEO position earlier this year, said "there's a lot more going on inside Gilead than the outside world knows." He said the company is in a "sweet spot."

One reason for his optimism is the $5 billion agreement Gilead signed with Belgian drug developer Galapagos in mid-2019. The pact doubles Gilead's scientific research staff and bolsters its pipeline.

As of the writing of this article, Gilead is battling in court with the U.S. Department of Health and Human Services, which accuses the company's $2-billion HIV drug Truvada infringes on federal patents. O'Day said the company has "seminal patent rights" for the drug.

Other drugs facing generic competition (and their sales for 2018 in the U.S.) include:

  • Pfizer's Lyrica, which brought in $3.5 billion
  • Amgen's Sensipar, which brought in $1.4 billion
  • Allergan's Restasis, which brought in $1.2 billion
  • Indivior's Suboxone film, which brought in $780 million
  • GlaxoSmithKline's Advair, which brought in $1.4 billion



Disclosure: The author has a position in Gilead and Amgen.

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This article first appeared on GuruFocus.