Teva's Non-Generic Side

As one of the world's largest generic drug companies, TevaPharmaceutical (NASDAQ:TEVA) has the well-earned reputation as scourge of the drug world. The company is constantly challenging the patents of branded drug makers so it can roll out its own knockoffs of the same medicines. Admittedly, sometimes its legal actions fail, but such setbacks are often mere bumps along a road that eventually leads to Teva getting its way.

But there is more to Teva than just generics, a point brought home in a recent announcement from the Israeli company. Yesterday, the firm disclosed that it had filed an investigational new drug application (IND) with the Food and Drug Administration to begin a clinical trial in the U.S. for laquinimod, an experimental medication for multiple sclerosis. Laquinimod, which is currently in phase 2 development in Europe, represents one prong of Teva's two-pronged effort to create an oral treatment for the disease.

Teva's other angle in MS treatment is an oral version of the firm's injectable medication Copaxone. The current form of Copaxone is currently a big success. In the first quarter, the drug became the United States' leading MS medicine in terms of total and new prescriptions. Worldwide, first-quarter sales rose 23% to $256 million. Teva clearly has built a franchise in MS treatment, and an oral medication would do wonders in cementing its leadership.

However, there are plenty of competitors also tinkering with the oral administration idea. Novartis (NYSE:NVS) recently reported positive phase 2 results for its own medicine, and Serono (NYSE:SRA) and Ivax (AMEX:IVX) are running phase 3 trials on another oral compound. Still, Teva's position in this race is solid, especially with respect to oral Copaxone, since the injectable version is already a known quantity in the MS field. Nevertheless, this race is too close to call at this point.

Teva remains a company to watch simply for its stake in the generics market, but its work in developing multiple sclerosis medications makes it an even more interesting investment prospect.

For more decidedly non-generic takes on Teva, check out:

• Teva: Scourge of the Drug World?
• Bad News for Teva? Yawn .

Fool contributor Brian Gorman is a freelance writer in Chicago. He does not own shares of any companies mentioned in this article.