NEW YORK - Shares of Scottsdale-based Medicis Pharmaceutical Corp., which makes skin medications, fell sharply to a new annual low after Impax Laboratories challenged a patent for its Solodyn drug for the treatment of acne.
In a filing with the Securities and Exchange Commission on Tuesday, Medicis said Impax informed the company it filed an abbreviated new drug application with the Food and Drug Administration. Impax is seeking approval to sell a generic version of Solodyn.
Hayward, Calif.-based Impax didn’t tell Medicis about the timing or status of the FDA’s reviews of its filing, according to Medicis. The company also said Impax did not say whether it had proven bioequivalence for Solodyn.
Bioequivalence is a regulatory requirement that the active ingredient of a drug be absorbed and metabolized in the body in about the same amount as the active ingredient of the brand name drug.
Medicis said it is evaluating Impax’s letter and considering its options.
Goldman Sachs analyst James Kelly expressed concern that Solodyn generates nearly half of Medicis sales.
According to his models, Solodyn represents 50 percent of gross profits for 2008.
Kelly pointed out that a generic launch is possible as soon as Impax receives approval from the FDA, whereas most patents are generally protected for 30-months following such an approval. He speculates a settlement between the two companies.
Kelly said, “Medicis faces important challenges in 2008, as the consumer slowdown could affect the aesthetics business and spending will increase to prepare for the Reloxin launch at year-end.” Reloxin is a product designed to treat wrinkles.
Cowen and Co. analyst Ken Cacciatore said that Reloxin will likely be approved later this year.