Momenta Pharmaceuticals Wraps Up a Bleak Year

Momenta Pharmaceuticals (MNTA) had a fairly rough 2017, with a delay in gaining approval from the Food and Drug Administration for Glatopa 40 mg/ml, compounded by new competition for Glatopa 20 mg/ml. Nevertheless, the biotech presses on, regrouping as it tries to figure out the best way to pay for its promising pipeline.

Momenta Pharmaceuticals results: The raw numbers

Data source: Momenta Pharmaceuticals.

What happened with Momenta Pharmaceuticals this quarter?

• Glatopa 20, the daily version of Teva Pharmaceutical's (TEVA) Copaxone, contributed $13 million in sales, lower than the $15.8 million in the year-ago quarter, as Momenta and partner Novartis' (NVS 1.10%) Sandoz generic-drug division face competition from Mylan's (MYL) generic version of the drug.
• The generic version of Sanofi's Lovenox added a paltry $0.3 million.
• Most of the rest of the revenue -- and the reason for the quarterly profit -- came from recognizing the one-time $50 million upfront payment from CSL for their partnership. Of course, the year-ago quarter had a one-time recognition of revenue from Momenta's deal with Baxalta (now part of Shire), so comparing year-over-year changes is rather pointless.
• Earlier this month, the FDA finally approved Glatopa 40, which has been launched by Novartis. But instead of being the sole generic, Glatopa 40 will now have to compete with Mylan's version.
• A marketing application for M923, the biosimilar to AbbVie's Humira, is ready to be submitted to the FDA. But the company is waiting to find a partner before submitting, allowing a potential partner to decide which patents it wants to challenge. Since the first biosimilar of Humira isn't expected to launch until 2022 or so, there isn't much rush.
• Momenta's next most advanced biosimilar, M834, a copycat of Bristol-Myers Squibb's Orencia, failed a phase 1 trial in November. Momenta and its partner Mylan are still trying to decide the next step for the program.
• In January, Momenta and Mylan disclosed the second drug in their partnership, M710, a biosimilar of Regeneron Pharmaceuticals' Eylea. The companies plan to start a clinical trial required for FDA approval in the first half of this year, and it should take about two and a half years to complete.
• Turning to Momenta's pipeline of novel drugs, M281 looked safe and appeared to be doing what it's supposed to -- lowering IgG levels -- in a phase 1 trial in healthy volunteers. Momenta is planning to start a proof-of-concept study in the second half of this year.
• Momenta's partner CSL started a phase 1 trial for M230 in January, with data expected within a year.
• The clinical program for M254, a souped-up version of intravenous immunoglobulin, is expected to enter a clinical trial in the second half of the year.

Image source: Getty Images.

What management had to say

Craig Wheeler, Momenta's president and CEO, highlighted the complexity of the Copaxone generic market, which Momenta and Novartis' Sandoz had thought they'd have all to themselves:

Mylan's entry as a sole generic back in October changed the market dynamics significantly. Based on Sandoz's recent experiences in [the] 20-milligram market, and Teva's public comments regarding Mylan's entry with its unprecedented discounts in both 20-milligram and 40-milligram markets, we do not believe the opportunity for our Glatopa 40-milligram product is as significant as it once was.

Given the lower expected revenue and being four years away from launching M923, Wheeler noted plans to conserve cash: "We recognize the need to adjust our efforts to live within our means, and are undergoing a comprehensive strategic review of our business to make sure that we are optimizing our spending toward the most value-creating asset that we have in the portfolio."

Looking forward

Clinical trial readouts look like they'll be a little sparse this year, so most of Momenta's news flow in 2018 will likely come from deals to sell or license compounds in its pipeline. This will have the advantages of both decreasing spending on those assets and generating cash to fund what remains.

It'll also be interesting to see which diseases Momenta goes after with M281. There are quite a few immune-mediated disorders where a drug that lowers IgG levels should help patients -- many of which are orphan indications without any treatment options -- but management has been coy so far as to which diseases it'll go after first.