Wall Street Disappointment With Biogen Hits Teva

26 March 1997

Despite European approval for its multiple sclerosis drug Avonex(interferon beta-1a), many Wall Street analysts have withdrawn their previous recommendations on US biotechnology company Biogen. They expect lower-than-forecast 1997 first-quarter sales. However, it is not clear whether this is due to over-optimistic forecasts for Avonex' prospects or whether the initial excitement amongst MS patients and the neurologist community has subsided.

In any case, this has had an adverse impact on Israel's Teva Pharmaceuticals' share price (now down 17%), which had reached new peaks of $65 in recent weeks, following the release of 1996 results (Marketletter March 3). Teva's MS product Copaxone (glatiramer acetate) is expected to be distributed for the first time in the USA in April, though the firm is not expecting profits from the product in 1997.

A positive factor at present has been the long and ongoing winter season of flu and colds in Israel this quarter. Analysts will also be looking closely at the company's inventory situation this quarter; this has increased from $232 million in 1995 to $326 million by end-1996.

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