After five years of court battles, Pfizer and Indian generic manufacturer Ranbaxy Laboratories agreed to settle most of the Lipitor patent litigation worldwide on June 18.
The battle began when Ranbaxy challenged Pfizer's Lipitor patents in August 2003 and said that extensions to the patents were obtained to fend off generic versions.
Cholesterol drug Lipitor is one of the largest-selling prescription drugs with worldwide sales in 2007 of $12.7 billion.
Litigation took place all around the world with both parties winning some favourable decisions.
Under the agreement, Ranbaxy retains 180-day exclusive rights to sell generic versions of Lipitor in the US from November 30 2011. The Indian company also has a licence to sell generic versions of Lipitor and the fixed-dose combination of atorvastatin-amlodipine besylate (Caduet) in the US from November 30 2011.
Ranbaxy can sell generic versions of Lipitor on varying dates in an additional seven countries: Canada, Belgium, the Netherlands, Germany, Sweden, Italy and Australia.
The settlement also resolves additional patent litigation between the companies involving the branded drugs Accupril (US) and Viagra (Ecuador) and all patent litigation relating to the generic formulation of quinapril hydrochloride in the United States and sildenafil in Ecuador.
However, litigation between Ranbaxy and Pfizer relating to Lipitor will continue in five European countries - Finland, Spain, Portugal, Denmark and Romania.
Malvinder Mohan Singh, CEO of Ranbaxy, said that this "comprehensively settles outstanding issues" between the two companies bringing to a close a number of patent disputes.
"This will make the world's largest selling drug more accessible to patients who will gain from the timely availability of an affordable quality option," he added.
The news is bound to have an impact on the pharmaceutical market and lawyers believe that such settlements might become more common given the high risk involved in most patent cases.
"It is obviously a big deal. This is the biggest drug out there. It shows that pharma companies and generics are more willing to compromise on IP and that a settlement is a route both parties want to pursue. Given the stakes on both sides it was expected," said Jonathan Singer, a principal at Fish & Richardson.
He described the deal as a compromise as Ranbaxy has to respect Pfizer's later patents, while the generic producer gets the post-patent expiry exclusivity for 180 days, and there is a deal on the combination of the doses.
David Wilson, a partner at Herbert Smith in London who is not involved in the litigation, said that the deal looks good for Pfizer as it extends the company's monopoly past the basic compound patent.
"Given the bigger stakes it was favourable to do it. I think what drove this was the US market which is this still the largest market for this product," he added.
Ian Read, president of worldwide pharmaceutical operations for Pfizer, said that the agreement is a "win-win-win because it is pro-patient, pro-competition and pro-intellectual property".
"It provides substantial certainty regarding the timing of the entry of a generic version of Lipitor," he added.
Ranbaxy has already agreed three settlements in the past year; with
AstraZeneca (Nexium)
, Astellas Boehringer (Flomax) and GlaxoSmithKline (Valtrex).
This deal comes a few days after Japanese research-based pharmaceutical company Daiichi-Sankyo
bought
a controlling stake in Ranbaxy on Wednesday June 11.
A couple of days later, Indian newspaper
Business Standard
and
Reuters
speculated that Pfizer might prepare a bid to buy a non-promoter stake in Ranbaxy though both parties dismissed these reports as rumours.
When asked if there was a link between the news of the last few days Wilson said this settlement does well to downplay the rumours while Singer was not so sure. "These deals don't happen overnight. I imagine discussions were concurrent," he added.
The
News Focus
in the May edition of
Managing IP
looks at patent litigation battles in India and contains a profile of Ranbaxy.
