Teva Pharmaceutical Industries Ltd (NYSE:TEVA) has been approved as a member of PhRMA over complaints from its rivals.
PhRMA made the announcement on Friday stating that it has absorbed Teva as a member along with other drug manufacturers including Jazz Pharmaceuticals plc (NASDAQ:JAZZ) and Alexion Pharmaceuticals, Inc. (NASDAQ:ALXN). Other firms including Horizon Pharma PLC (NASDAQ:HZNP) and AMAG Pharmaceuticals, Inc. (NASDAQ:AMAG) also received full membership after shifting from their former status as research associates.
Teva is a generic drug manufacturer that is based in Israel. The pharma’s application to be a member of PhRMA was not exactly easy because it was met with a lot of resistance from other drug manufacturers such as AbbVie Inc (NYSE:ABBV). This is because Teva manufactures generics which are considerably lower priced than the drugs they imitate.
The opposing drug makers argued that allowing a generic manufacturer into the association goes against the association’s push for innovation in the pharmaceutical industry. They also argued that allowing a drug copier into the association would lead to internal conflicts between the Israeli firm and the other members of the association. This is because Teva has been seeking to invalidate patents held by some of the firms that are members of the pharmaceutical association.
Teva, however, believes that it will be right at home as a member of PhRMA. The company is one of the most successful generic drug manufacturers based on sales. Its huge success is particularly attributable to its multiple sclerosis treatment known as Copaxone. It is also partly attributed to the acquisition of Cephalon. Teva registered an astounding $6 billion in sales in 2015, making it a better performer than some of the other pharmaceuticals that are also members of PhRMA.
The association believes that having companies like Teva on board is a good idea because it will help to avoid claims that members enforce steep pricing. It could, therefore, help to address drug costs more comprehensively.