Business in Brief: Teva Shares Tumble With Threat to Copaxone

Adama looks to New York as VBL abandons Big Apple IPO.

Teva's headquarters in Jerusalem.
Bloomberg

Teva shares pounded by new threat to Copaxone

Teva Pharmaceuticals’ shares took a tumble on the Tel Aviv Stock Exchange Sunday, after the Indian generic drugs firm Dr. Reddy filed the first patent challenge in the United States against Teva’s best-selling multiple sclerosis drug Copaxone. Teva confirmed late on Thursday it had received the first paragraph IV notice for its three-times-a-week, 40 milligram version of Copaxone, and that it would file a lawsuit for patent infringement against Dr. Reddy within 45 days. Filing of the lawsuit will trigger a 30-month stay of approval of Dr. Reddy’s application with the U.S. Food and Drug Administration. Dr. Reddy plans to challenge a patent that Teva says protects the 40-milligram version of the drug until 2030. Shares of Teva, which earned 63% of its operating profit from the MS drug in the second quarter, closed down 2.9% to 176.80 shekels ($50.86) in Tel Aviv.

Adama to file to sell shares in New York

Adama, the generic maker of agrochemicals once called Makhteshim Agan, is set to publish a prospectus in the next few days to sell shares in the United States. The Adama board, which is 60% owned by China National Chemical Corporation and the rest by IDB group, approved the plan but left open whether the shares would trade on the New York Stock Exchange or Nasdaq. The initial public offering will likely occur at the end of 2015 or early in 2015, marking the company’s return to public trading for the first time since it was delisted from the Tel Aviv Stock Exchange four years ago. Before going public, Adama is expected to buy three ChemChina units – Sanonda, Anpon and HH – which will improve its cost structure and access to the Chinese market. On Sunday, Adama reported a 24% rise in second-quarter net profits to $60 million.

Israel Chemicals warns on Sheshinski costs

Israel Chemicals said that if the government’s Sheshinski committee’s interim recommendations had been in effect last year, they would have shaved profits by $160 million. In 2014, however, ICL admitted that the impact would have been smaller, because the price has fallen 20% since last year due to lower energy costs as its switched to natural gas. The committee, whose final recommendations are due to be published in the next few weeks, is weighing plans to revise the royalties that companies pay to exploit Israel’s natural resources. ICL is planning costs savings amounting to $350 million to compensate for the higher royalties, but is also freezing some $750 million in new investment, and warned that adopting Sheshinski will hurt the economy. ICL shares fell 0.6% to close at 28.22 shekels ($8.12) in Tel Aviv.

VBL abandons New York IPO after pricing stage

VBL Therapeutics said Friday it was forced to terminate its initial public offering in New York after an existing shareholder failed to come up with the money for shares it had agreed to buy in the offering. “An unexpected situation in which a substantial existing U.S. shareholder did not fund payment for shares” caused underwriters Deutsche Bank and Wells Fargo Securities to terminate their underwriting agreement, the company said. VBL, which is developing treatments for cancer and immune-inflammatory diseases, had priced the IPO at $11 a share and had hoped to raise $64.8 million, valuing the company at $222 million after the money, and shares had been trading Friday at $11.15. VBL didn’t identify the shareholder, but its biggest are Keffi Group, a U.S. investment company; Morris Kahn’s Aurum Ventures; and the Israeli venture capital fund Pitango.

TA-25 index marks its third session lower

The Tel Aviv Stock Exchange’s TA-25 index extended its decline into a third session on Sunday, led by technology and banking shares, as the fighting in Gaza showed no immediate signs of ending. The benchmark index ended 0.2% lower at 1,386.26 points while the TA-100 lost 0.3% to 1,232.76. Turnover was a very light 325 million shekels ($93.5 million). Among the biggest losers in the TA-100, Perion Network skidded 5% to close at 24.52 shekels and LivePerson fell 3.3% to 42.94. Bonds were higher, with the government’s 10-year shekel bond up 0.91% to cut its yield to 2.7%, while its inflation-indexed debt due in 2023 rose 0.15% to a yield of 0.654%. The dollar and euro both strengthened on Friday by more than 0.7% to Bank of Israel rates of 3.476 and 4.65, respectively.