Teva’s generic EpiPen approved in the U.S., with perfect timing

Teva Pharmaceuticals Industries Ltd.’s generic EpiPen has been approved for U.S. use, the Food and Drug Administration announced on Thursday afternoon, clearing the path for the market-dominating product’s first true generic rival.

The development represents a success for the generic drugmaker TEVA, +6.74% as the FDA previously declined to approve its treatment for life-threatening allergic reactions back in 2016.

It also comes at a time of monthslong spot shortages of Mylan’s EpiPen MYL, +0.08% an authorized generic also made by the company and a separate generic autoinjector.

Parents with allergic children have been worried about securing the products in time for back-to-school season, MarketWatch reported earlier this week.

The new alternative should help protect against shortages as well as offer patients a lower-cost option, Food and Drug Administration Commissioner Scott Gottlieb said in a statement. The regulator also noted that generic versions of products like the EpiPen, called “combination products” because they are made up of both a drug and a device, can be more difficult to make, and that it has previously put out guidance intended to clarify that development process.

The FDA approved both adult and child-appropriate dose levels of the generic epinephrine autoinjector. Teva has not yet said how much the product will cost or when it will come to market; the company did not immediately return MarketWatch’s request for comment.

A generic EpiPen is already available, at around $320 per two-pack, but it is sold by Mylan, the same company that sells the brand-name, which is priced at about $630 per two-pack, and came only after an outcry over the branded product’s price. These so-called “authorized generics” are viewed by experts as a way of undercutting generic competition, as new entrants typically must come in at a lower price.

Shares of the U.S.-listed Teva surged 6.5% in extremely heavy Thursday afternoon trade, while Mylan shares rose 0.4%. Rival Amneal Pharmaceuticals Inc. AMRX, -1.46% which sells a generic of the epinephrine auto-injector Adrenaclick, saw its shares drop 1.4%.

Adamis Pharmaceuticals Corp. ADMP, -16.18% which had its syringe that is pre-filled with epinephrine, called Symjepi, approved last year but has not yet launched it, saw its shares drop 13.2%. The company said last week that the commercial launch of the product would come at the discretion of its partner, Novartis’ Sandoz unit NVS, +0.39%

The news should also come as a reprieve for Teva, which has sought a turnaround amid difficult competitive pressures in the U.S. generics market.

Teva shares have risen 14.6% over the last three months, compared with a 3.3% decline in Mylan shares, a 4.5% rise in the S&P 500 SPX, +0.88%   and a 3.3% rise in the Dow Jones Industrial Average DJIA, +1.67%