October 21, 2005

Ranbaxy Laboratories has filed a lawsuit in New Jersey Superior Court against Barr Laboratories and Teva Pharmaceutical, alleging the two drugmakers breached Barr's contract with Ranbaxy by secretly cutting a deal to produce generic Allegra. Sales of Allegra, used to treat symptoms of seasonal allergic rhinitis, totaled approximately $1.4 billion for the 12 months ended June 30.

Ranbaxy and its partner in the suit, active pharmaceutical ingredient marketer Agvar Chemicals, say they helped Barr develop generic Allegra (fexofenadine HCl) but were then left "out in the cold" when Barr traded away its 180-day exclusivity period in an at risk launch with Teva.

But Barr spokeswoman Carol Cox called the suit "baseless and frivolous" and told FDAnews that the agreement with Ranbaxy "did not extend beyond the [drug] application."

"There was no agreement to breach ... we've already paid them for the work they did," she said.

Ranbaxy and Agvar contend they entered into a contract in May 2000 to supply Barr with the active ingredient in Allegra to help Barr obtain FDA approval to market a generic version of Allegra, with the understanding that there would be a 180-day period of exclusivity. But in early September, a few days after obtaining FDA approval, Barr transferred its 180-day exclusivity period to Teva, leaving Agvar and Ranbaxy "out in the cold despite their valuable contributions to the project," the plaintiffs said.

"We operated in good faith over a period of five years, lending technical expertise to Barr in the development of the fexofenadine hydrochloride tablets and investing heavily in facilities to meet the demands of Barr, only to be surprised by an undisclosed relationship between Barr and Teva," Jay Deshmukh, Ranbaxy's vice president of global intellectual property, said in a statement.

In September, Barr agreed to transfer its 180-day exclusivity period to Teva and to help secure the necessary regulatory approvals to market the drug, in exchange for a percentage of the gross profits from Teva's generic Allegra sales. Barr said the partnership will help mitigate potential losses from the at-risk launch. A Teva spokesman declined to comment on the case.