US Setback For Lupin’s GxProAir But Application Has 'Moved Ahead'
Executive Summary
Lupin is staring at stretched launch timelines in the US for its generic ProAir following a Complete Response Letter, but the company maintains that its application has progressed and the market opportunity for the product remains attractive.
Lupin Ltd. has received from the US FDA a Complete Response Letter (CRL) for its generic version of Teva Pharmaceutical Industries Ltd.'s ProAir (albuterol sulfate) metered dose inhaler, a key asset that was expected to help propel the Indian firm’s growth in the inhalation segment in the US.
Lupin was hoping to hit the US market with its generic ProAir in the second half of fiscal 2019-20 and the setback dulls its anticipated lead over competitors like Cipla Ltd. and Perrigo Co. PLC, also in the fray for the product.
Lupin did not elaborate on the specifics of the CRL but told Scrip that “site compliance issues do not impact this application.” The Indian firm’s plants have been under the scanner by the FDA and some have failed to make the compliance cut over the recent past.
Lupin also maintained that it is confident of “comprehensively addressing” the agency’s questions and is preparing to respond in the next two months. “We believe that the application has moved ahead significantly,” the firm underscored.
However, with the regulatory push-back , Lupin indicated that it was revising its launch timeline for generic ProAir, now “likely be in the 1H FY’21”, but maintained that the “opportunity remains attractive.”
Competitive Scenario
Multiple albuterol brands, including authorized generics, are already available on the US market, though Lupin’s senior management has in the past stressed that the product presents a “very lucrative” market opportunity.
“The entry of a ‘true’ generic would be very welcome in the market. We would also have very strong cost of goods,” Lupin’s managing director Nilesh Gupta told Scrip in a recent interview. (Also see "Lupin Boss On Getting Biosimilar Manufacturing Right, Albuterol Outlook" - Scrip, 20 Jun, 2019.)
Albuterol sulfate authorized generic versions of GlaxoSmithKline PLC’s Ventolin HFA inhalation aerosol and Teva’s ProAir HFA became available in January this year, while in April, Par Pharmaceutical said that it had begun shipping an authorized generic of Merck & Co. Inc.’s Proventil HFA (albuterol) inhalation aerosol.
Investment bank Jefferies said that the CRL would delay the approval of Lupin’s albuterol to “best case 1QFY21 and launch to mid-FY21 versus the earlier guidance of 4Q20”, also noting that there are already three authorized generics launched, with three generic filers expecting approval in the next 12 months.
“There is a possibility then that other generics launch earlier (Cipla and Perrigo) which will further reduce Lupin’s gain,” Jefferies equity analyst Piyush Nahar said in a note dated 19 September.
Peer Cipla had earlier stated that it has the cost competitiveness to price “significantly lower” than its competition, and that it could take a “fair share” of the albuterol market amid the arrival of authorized generics.
Challenges For Complex Generics
Some analysts, however, did not appear too surprised about the US agency's action pertaining to Lupin's albuterol and highlighted that the firm's commentary around the product has, over the recent past, been “tentative.”
At the firm’s annual investor meet in May, CEO Vinita Gupta indicated that the company had responded to certain questions from the FDA, adding that she “hoped that is going to be a second half launch in the fiscal year.”
“We hope that the FDA does approve it. Now the FDA has not approved any MDI [metered dose inhaler] so far…so there may be hiccups with the complex generics along the way but we are committed to getting that product through,” Gupta said at the time.
But Nimish Mehta, founder of Research Delta Advisors, noted that the approval and launch trajectory of complex generics in the US has, in general, been less predictable.
“The CRL is a setback, but in the broader context, we’ve seen similar challenges for complex generics across industry, including for Copaxone [glatiramer],” Mehta told Scrip, adding that there’s a chance Lupin may still be in time for a launch along with other competitors.
Warning Letter
The CRL for generic ProAir comes at a time when Lupin is facing regulatory heat on the manufacturing front, with some of its sites failing to make the compliance cut.
Most recently, the company’s Mandideep (Unit-1) facility in India received a warning letter from the US FDA. The agency had in March this year classified its inspection at the site in December 2018 as Official Action Indicated (OAI).
Lupin, however, informed the Bombay Stock Exchange that there are no DMF (Drug Master File) or ANDA applications pending review or approval from the Mandideep (Unit-1) facility, and that the warning letter should not impact supplies or existing revenues from operations of this facility.
“We are committed to addressing the concerns raised by the US FDA and will work with the agency to resolve these issues at the earliest,” Lupin said in a 19 September filing. Lupin’s sites in Goa and Pithampur (unit 2) have, among others, been pulled up for compliance deviations over the recent past. (Also see "Lupin Q1 Profit Up 50% But Regulatory Overhang, Slow Product Scale-Up Sparks Concern" - Generics Bulletin, 13 Aug, 2019.)