
Novartis returned the US rights to Vectura for the development and commercialisation of VR315, a combination compound for asthma and COPD, Vectura reported on Thursday.
Analyst Savvas Neophytou of Panmure Gordon speculated that VR315 is a generic version of GlaxoSmithKline's Advair (salmeterol/fluticasone), however, the companies have not confirmed this.
Commenting on the news, Jeffries International analysts remarked that "for [Novartis' Sandoz unit] to hand back development of what could be a potentially significant generic immediately questions whether it views taking a generic of this type to the US market as viable.
" Analyst Mike Ward of Ambrian Partners explained that gaining approval in the US for a new drug containing a long-acting beta-agonist (LABA), such as Advair, could be more difficult amid concerns about the safety of LABA-containing products. Novartis will retain European rights to VR315, where experts say the drug is more likely to gain approval.
The analysts at Jeffries International added that they are "relatively relaxed" about the potential of a US generic threat to Advair, which had sales of 5 billion pounds ($7.6 billion) in 2009, in part because there are currently no FDA guidelines for developing a generic inhaled, long-acting product.
In addition, analysts at Singer Capital Markets believe that "without the marketing muscle of [Novartis] or its expertise with the FDA, the cost of getting VR315 to market is likely to be much higher across patent, regulatory and marketing costs."
Vectura, which saw its shares fall as much as 24 percent on the news, stated that it will receive a $9.5-million cash payment from Novartis in the second quarter and may receive other payments under the terms of the revised agreement.