GENERICS TAKE HIT AS COURT RULES AGAINST RANBAXY

A U.S. federal court has ruled for Pfizer after Ranbaxy Laboratories challenged two Pfizer patents for Lipitor, blocking generic drugmakers from capitalizing on Lipitor's success until 2011. Lipitor posted worldwide sales of $8.83 billion this year, with U.S. sales of $5.33 billion and foreign sales of $3.5 billion.

It is the second such blow to an Indian drugmaker this year, as well as to generics companies that must defer their versions of a blockbuster drug until six months after the first generic challenger launches its product. Dr. Reddy's in April lost its patent challenge to Eli Lilly's top-selling schizophrenia drug Zyprexa (olanzapine), which posted worldwide sales of more than $4.8 billion in 2004.

The ruling on Lipitor, by Judge Joseph Farnan of the U.S. District Court for the District of Delaware, blocks Ranbaxy from marketing or obtaining approval for generic Lipitor until 2011. Farnan ruled Ranbaxy's version of Lipitor (atorvastatin calcium) infringed on both Lipitor's basic patent for atorvastatin, which expires in March 2010, as well as the patent covering the crystalline form of atorvastatin — the form sold as Lipitor — which expires in June 2011. Ranbaxy said it would appeal the case, which was heard in December 2004, to the U.S. Court of Appeals for the Federal Circuit.

Pfizer plans to launch another cholesterol drug, torcetrapib, in 2008, and the generic delay will give the company more time to complete studies on the experimental drug, Bank of America analyst Chris Schott writes in a recent note.

Pfizer's victory will also benefit Schering-Plough, as an early generic debut of Lipitor would have hurt sales of Schering's rival cholesterol drug Vytorin (ezetimibe/simvastatin), Merrill Lynch analyst David Risinger said.

While the ruling is a setback for generic drug firms, it won't deter them from filing first challenges to brand patents, Andrew Berdon of Quinn Emanuel Urquhart told FDAnews.

"If all you do is challenge the 'design-around' type formulation patents and never do one of these first-to-file patents, you will never have a transformative success, like Barr [Laboratories] saw with Prozac," Berdon said. "A win in that one case and the profits from 180 days of exclusivity transformed Barr from a company that had a lot of potential to a company that had a lot of success ... it only takes one win to transform your company," Berdon said.

Barr successfully challenged Eli Lilly's patent on Prozac (fluoxetine) in 2001, winning the right to launch a generic version of the drug roughly two and a half years before Lilly's patent on the antidepressant was set to expire.

Pfizer's latest victory doesn't mean it's completely out of the woods, either. Ranbaxy plans to appeal the Delaware court's ruling, and Pfizer faces generic competition from Zocor (simvastatin), another cholesterol drug, which goes off patent in June 2006.