Mylan N.V. (NASDAQ:MYL) is a midweek winner in the biotechnology space this week, with the company picking up some strength in the back of a regulatory green light for one of its lead development assets.

The company announced on Wednesday that the FDA has approved its Abbreviated New Drug Application (ANDA) for a drug that’s targeting an indication of the treatment of patients with relapsing forms of multiple sclerosis (MS). As many reading will likely already be aware, the drug is actually a copy, or to use the correct term, a generic version, of a drug called Copaxone, which was developed by Teva Pharmaceutical Industries Ltd (ADR) (NYSE:TEVA) and was first approved in the US way back in 1997.

It has been a blockbuster for Teva ever since and generated a little over $3.4 billion for the company during 2016 alone. With the latest approval, however, the drug’s ability to even maintain blockbuster status (generally regarded as above $1 billion in annual revenues), never mind bring in multiple billions of dollars in revenues for Teva, is questionable.

From a chemical perspective, the drug is a mixture of random sized peptides that are comprised of the four amino acids found in myelin basic protein, namely glutamic acid, lysine, alanine, and tyrosine. Its mechanism of action is pretty elegant – the myelin basic protein is the antigen that is attacked by the immune system in patients with MS. This causes the lack of protection for neurons that characterizes the disease. By adding extra myelin basic protein to the body through Copaxone administration, or glatiramer acetate as the generic version is known, the additional protein acts as a sort of decoy for the actual protein and is attacked by the immune system instead of the protein that forms the myelin sheath.

Its mechanism of action is pretty elegant – the myelin basic protein is the antigen that is attacked by the immune system in patients with MS. This causes the lack of protection for neurons that characterizes the disease. By adding extra myelin basic protein to the body through Copaxone administration, or glatiramer acetate as the generic version is known, the additional protein acts as a sort of decoy for the actual protein and is attacked by the immune system instead of the protein that forms the myelin sheath.

Anyway, as is to be expected with a development like this, a number of companies have responded from a market capitalization perspective on the announcement that the drug has been approved as a generic version.

Perhaps least unexpectedly, Mylan has jumped to the tune off 16% on the back of the news. This is a considerable appreciation for a company of Mylan’s size (valued at a little over $20 billion at current share price) so we may see the company settle down a bit as we head into the weekend and markets absorb the implications in a little bit more detail. We might also see some profit taking as the shorter term operators who were in for a binary play withdraw.

Other movers include Teva (again, this one is not much of a surprise), which is down an equal proportion – around 15% – on the announcement and Momenta Pharmaceuticals, Inc. (NASDAQ:MNTA), which makes a lower dose version of the Teva asset and has suffered delays recently in its attempt to pick up approval for a higher dose version of the drug. Momenta is down 16% from its Wednesday opening price.

So what is next for these companies?

As noted, the response for Mylan seems to be a little bit exaggerated. The implications of this from a financial perspective for the company are strong, but whether they warrant an upside revaluation to the degree that we have seen this week is questionable. Analysts expect that the drug will add about $0.13 in earnings per share per quarter onto the company’s numbers, which is not terrible but it does seem to underscore an overreaction.

The implications for Teva are much more serious and they are not just limited to Copaxone. The FDA has been pushing to bring generic drugs to market faster and faster over the last few years and the latest approval for Mylan’s generic Copaxone is a symptom of this effort. For the pharmaceutical population, i.e. those who need these drugs, this is a great thing – they get drugs cheaper and quicker than might otherwise be the case.

For companies like Teva, however, which generate a large portion of their revenues from drugs that are coming out from underneath patent protection near term, we could see the FDA actions translate to a substantial dip in topline over the coming years and, by proxy, a tightening of bottom-line along the way.