Allergan: Japan Reportedly Demands Steep Discounts For Botox

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Allergan's Botox

Allergan (AGN) is under siege from generic drug makers like Mylan (MYL) and Teva (TEVA). In Q3 2017 the company’s second-best selling drug, Restasis (dry eye), had its patents invalidated in federal court due to obviousness. Allergan’s Mohawk deal, designed to thwart and inter partes review (“IPR”) brought on by Mylan, and FDA approval were the only two things keeping generic Restasis off the market.

In late February the Patent Trial And Appeal Board (“PTAB”) of the U.S. Patent And Trademark Office put the Mohawk deal out of its misery:

Upon consideration of the record, and for the reasons discussed below, we determine the Tribe has not established that the doctrine of tribal sovereign immunity should be applied to these proceedings. Furthermore, we determine that these proceedings can continue even without the Tribe’s participation in view of Allergan’s retained ownership interests in the challenged patents. The Tribe’s Motion is therefore denied.

Less than two weeks after the PTAB ruling AGN hit a 52-week low of $143. AGN has bounced 16% off its low. The rise seemed inexplicable given that the company’s outlook and earnings fundamentals had not changed. Last week management divulged it had a new narrative – it was exploring strategic options for the company.

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