Mylan Teva EpiPen generic auto-injector market

Mylan CEO Heather Bresch with EpiPens.Reuters

• The FDA on Thursday approved Teva Pharmaceuticals’ generic version of the drug, dealing a blow to branded EpiPen-maker Mylan.
• Mylan saw an approximately 63% drop in EpiPen sales between 2017 and 2016, according to calculations made by Wells Fargo analyst David Maris. 
•  Analysts estimate that Teva estimate that Teva could control as much as a third of the approximate $750 million EpiPen market with its generic.

The EpiPen market is in for a major shakeup.

On Thursday, the FDA approved Teva Pharmaceuticals‘ generic version of the drug, dealing a blow to branded EpiPen-maker Mylan.

Depending on when Teva launches its generic alternative to the lifesaving allergy injection and what price it comes in at, it has a shot at picking up a big chunk of the epinephrine market as Mylan faces shortages and as parents look to stock up at the start of a new school year. 

Mylan once controlled as much as 90% of the epinephrine market, though that percentage has declined in recent years to around 74%, according to a Wells Fargo estimate. An epinephrine auto-injector made by Impax Laboratories has picked up around 25% of the market, while Auvi-Q — which has a $4,500 for a two-pack list price — has about 2% of the market. 

Raymond James analysts estimate that Teva could control as much as a third of the approximate $750 million epinephrine market, though it remains to be seen what drug companies Teva will take market share away from. 

At its peak, Mylan made about $1 billion in sales a year from EpiPens. Then in 2016, the company came under scrutiny after the public realized that the list price of a two-pack of EpiPen had gone up from $93.88 to $608.61, an increase of more than 500% over a decade. 

In response to that outcry, Mylan came out with a $300 generic version of the EpiPen which now makes up about half of the epinephrine market. That made an impact on EpiPen sales, and in 2017 Mylan said its branded sales fell by $655 million. Though the company didn’t break out its branded and generic sales for 2017, Wells Fargo analyst David Maris estimated it to be around $633 million in total. 

While the outrage over the price of EpiPens died down, Mylan’s faced another challenge: shortages. 

In May 2017, the FDA said that there was a shortage of EpiPens in the US, because of issues with the device’s manufacturer, Pfizer’s Meridian Medical Technologies. Mylan said on an earnings call last August that the device may not always be available, varying by pharmacy. Wells Fargo called up 53 pharmacies around the US and found that roughly half of them were out of both Mylan’s branded and generic EpiPens. 

In part because of the lack of available EpiPens, prescription volume has been down compared to past years. “We believe there is pent-up demand,” Maris said. That could bode well for Teva, depending on when it launches its generic into the market. 

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