It took long enough, but the wait was worth it.
Motley Fool Rule Breakers
recommended Momenta Pharmaceuticals
Normally the approval of a generic drug wouldn't trigger that kind of response, but this is no ordinary generic. Sanofi sold 1.8 billion Euros worth of Lovenox in the U.S. last year, which translates into about $2.3 billion at today's exchange rate.
More importantly, Lovenox is a fairly hard drug to make. That's the reason the FDA took so darn long to approve the drug, but the complexity provides some protection from competition. Both Teva Pharmaceuticals
How long the competition-free period remains is very important because it'll affect not only the price of the generic drug, but also Momenta's share of the revenue. If Momenta and Novartis' product is the only generic on the market, Momenta gets a profit share of between 40% and 50%. If other competitors make it to market, Momenta only gets a royalty in the high single-digit to low double-digit.
Looking ahead for Momenta, its first FDA approval is an endorsement of the company's technology of characterizing and copying complex molecules. In addition to generic Lovenox and helping the FDA sort out Baxter's
Hopefully investors won't have to wait nearly as long for Momenta's second approval.
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