Amgen's Fight with Novartis

Vestact recommended pharma company Amgen has an extremely promising drug called Erenumab (trade name Aimovig) which is a medication which targets the calcitonin gene-related peptide receptor (CGRPR) for the prevention of migraines. It was approved by the US FDA in 2018.

As you can see from the picture, the drug is sold with an auto-injector so that the monthly dose can be taken subcutaneously. The list price is about $6,900 per year.



Because Aimovig was the first in this class of migraine drugs to get FDA approval, it got the upper hand and controls 53% of the market. US sales of Aimovig were $119 million in 2018, but Wall Street analysts think sales could reach almost $2 billion by 2025.

In 2015 and 2017, Amgen signed development and marketing agreements with Swiss-based competitor Novartis (including its subsidiary Sandoz) to sell the drug outside of the US.

Unfortunately, the migraine drug partnership has become a headache (please excuse the pun), and a legal fight has erupted between the two parties. Amgen terminated the contracts last week, alleging that Sandoz (i.e. Novartis) violated the terms by helping another company, Alder BioPharmaceuticals, make a competing migraine drug. Novartis admitted this after the fact, yet said it would still help Alder for another five years, according to Amgen's lawsuit.

Novartis denies the claims, arguing it didn't significantly breach their agreements because Alder's pending product isn't a true competitor. Instead, Novartis asserted Amgen is inappropriately ending the partnership "to keep the Aimovig profits for itself" and before Novartis "has come close to earning a return on its investment."

It sounds to me as if Amgen is in the right and Novartis is in the wrong? Maybe I'm biased, since we have Amgen shares coming out the Wazoo? Let's see what happens. In the meantime, migraine sufferers should continue to benefit.