UPDATE: Flamel Technologies (FLML) Slammed as Competitor Drug Approved

(Updated - January 14, 2015 1:56 PM EST) (Updated - January 14, 2015 1:44 PM EST)

Flamel Technologies (NASDAQ: FLML) is under heavy pressure Wednesday (-31.9%) after the FDA approved Fresenius Kabi's New Drug Application (NDA) for neostigmine methylsulfate, a drug which Flamel currently markets as Bloxiverz.

Previous reports suggested weakness was related to Jazz Pharma's (NASDAQ: JAZZ) patents on Xyrem. As noted by Guggenheim JAZZ analyst Louise Chen earlier, the PTAB (Patent Trial and Appeal Board) has denied four of the CBM (Covered Business Methods) patent petitions on Xyrem's distribution-related patents. The PTAB decided that it will be not be reviewing the first four of six CBM patent petitions. The decision on the remaining two patents should come in 1Q15. Chen said it is important to note that the two remaining CBM patents were filed later than the other four.

Related to neostigmine methylsulfate, Flamel said it is in discussions with regulatory and legal counsel to evaluate options that will minimize the potential competitive impact of Fresenius Kabi's NDA approval. An update will be provided to shareholders as more information becomes available.

Summer Street Research analyst Jim Molloy told StreetInsider.com the competitor's neostigmine approval probably takes $80 million per year out of Flamel's P&L.

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