Market-Moving Event: Health Canada Approves LONGAVO®
Teva Canada Limited, a subsidiary of Teva Pharmaceutical Industries Ltd., in partnership with Medincell, has received regulatory approval from Health Canada for LONGAVO® (risperidone LAI - Long-Acting Injectable) for the treatment of schizophrenia in adults. This announcement, made on September 23, 2025, represents a significant market expansion for the drug, which utilizes Medincell's proprietary BEPO® technology. Following this news, Medincell's stock experienced a substantial advance, underscoring strong investor optimism regarding the commercial prospects of the approved treatment.
The Approval in Detail
LONGAVO® is a long-acting injectable formulation of risperidone designed to provide controlled drug delivery for several days, weeks, or months following a subcutaneous injection. This innovative delivery mechanism is facilitated by Medincell's BEPO® technology, which enables a fully bioresorbable deposit. The Canadian approval for LONGAVO® follows earlier clearances for the same drug in the United States, where it is marketed by Teva as UZEDY®, and in South Korea by Teva Handok. The U.S. approval for UZEDY® occurred in April 2023, and it has since demonstrated robust commercial performance, recording $117 million in net sales in 2024 and $95 million in the first half of 2025. Medincell is positioned to benefit from these sales through mid- to high-single-digit royalties on worldwide sales and remains eligible for up to $105 million in commercial milestone payments.
Analysis of Market Reaction: Medincell's Significant Advance
Investor sentiment toward Medincell (MDCLF / MEDCL.PA) turned sharply bullish following the Canadian approval, with the company's stock experiencing a surge of over 100%. This strong market reaction can be attributed to the expanded market access for a key product utilizing Medincell's core technology, further validating its platform. The company's valuation metrics reflect this optimism; while the French Pharmaceuticals industry averages a price-to-sales (P/S) ratio below 1.7x, Medincell trades at a P/S ratio of 26.9x. This elevated valuation is largely underpinned by analysts' expectations of exceptional revenue growth, with forecasts predicting a 70% annual increase over the next three years, significantly outpacing the industry's projected 4.3% annual expansion. Historically, Medincell has demonstrated strong revenue momentum, with a 132% increase in the last year alone and an aggregate 233% growth over the past three years. Royalties from UZEDY® sales in the U.S. contributed €6.5 million to Medincell's revenue for the fiscal year ending March 31, 2025, marking a 3.8x increase year-over-year.
Broader Context and Implications
The approval of LONGAVO® in Canada solidifies Teva Pharmaceutical Industries Ltd.'s global presence in the schizophrenia treatment market and strengthens its partnership with Medincell. For Medincell, this represents a crucial validation of its BEPO® technology as a versatile and commercially viable drug delivery platform. The repeated regulatory successes across major markets, including the U.S., South Korea, and now Canada, are likely to enhance Medincell's attractiveness for future collaborations and investments within the Biotechnology Sector. The company's strategic focus on long-acting injectables (LAIs) aims to improve patient compliance and treatment efficacy across multiple therapeutic areas. Beyond risperidone, Medincell's pipeline includes an olanzapine LAI with first-in-class potential, anticipated for U.S. submission in H2 2025 and projected for approval and launch in 2026.
Christophe Douat, CEO of Medincell, has previously expressed enthusiasm regarding such regulatory achievements and their market impact:
"We are delighted to see UZEDY® receive regulatory approval in South Korea, further strengthening the strong commercial momentum observed in the United States since its launch in 2023. More patients living with schizophrenia will now be able to benefit from UZEDY® and its unique features, which position it as the treatment of choice.”
Stéphane Postic, CFO of Medincell, highlighted the company's financial trajectory:
"With revenue increasing by a factor of 2.8 and operational losses cut in half, we have taken a decisive step toward achieving operational profitability, anticipated for the next fiscal year ending on March 31, 2027. In addition, we have significantly strengthened our balance sheet, enabling us to optimize our financial strategy moving forward. These strong results provide a robust foundation to support our growth ambitions and drive long-term value creation.”
Looking Ahead
The successful regulatory clearance for LONGAVO® in Canada sets the stage for its commercial launch and will be closely monitored for its contribution to Teva's and Medincell's financial performance. The continued global expansion of BEPO®-based medications reinforces Medincell's position as an innovator in long-acting drug delivery. Investors will be watching for further updates on the commercial uptake of LONGAVO® in Canada, sustained growth of UZEDY® sales, and the progress of other key pipeline assets, particularly the olanzapine LAI, which could further accelerate Medincell's revenue growth and move towards anticipated operational profitability by fiscal year 2027. These developments are poised to influence the broader Pharmaceutical Sector, particularly in the specialized area of psychiatric treatments.
source:[1] Teva and Medincell’s Risperidone LAI Approved in Canada as LONGAVO® (https://finance.yahoo.com/news/teva-medincell ...)[2] Teva and Medincell's Risperidone LAI Approved in Canada as LONGAVO® - Business Wire (https://vertexaisearch.cloud.google.com/groun ...)[3] Medincell: UZEDY® Approved in South Korea Following Successful US Launch | Morningstar (https://vertexaisearch.cloud.google.com/groun ...)
Edgen Stock·Sep 29 2025, 18:56
