Scenario #1: Allergan And The Mohawks Lose The Appeal, Lose The IPR
If Allergan and the Mohawks lose the appeal then the IPR could move forward without protection of the Mohawks’s sovereign immunity. Judge Bryson previously ruled the patents were invalid due to obviousness. I think chances are slim that Allergan and the Mohawks could win an IPR without employing the Mohawks’s sovereign immunity. A loss in the IPR would likely clear the runway for Mylan (MYL) to launch generic Restasis; Mylan still has not received FDA approval for generic Restasis and is working towards a target action date of July 2018.
Restasis is of paramount importance to Allergan. It represents 9% of the company’s total revenue and about 12% of its income. A generic launch could sharply reduce revenue for the company’s second-largest drug behind Botox (about 16% of total revenue). It could punish AGN, which has fallen 25% since Allergan first sold the patents to the Mohawks in September.
