Financial Daily from THE HINDU group of publications
Saturday, Apr 16, 2005
Corporate - Courts/Legal Issues
Marketing - IPR
US judge rules Eli Lilly's patent valid Dr Reddy's loses case on generic drug trial, to appeal
Hyderabad , April 15
SETBACKS in the drug patent challenge continue to dog the Hyderabad-based Dr Reddy's Laboratories Ltd.
In what could be termed a major blow to its business prospects in the US generics market, the company has lost the patent trial on Olanzapine to Eli Lilly in US courts.
Olanzapine is the generic version of Eli Lilly's Zyprexa. It is used for psychotic disorders, especially schizophrenia, and is the company's biggest earners.
The US District Court for the Southern District of Indiana has issued an opinion following the completion of a trial on Eli Lilly's US patent No: 5,229,382 relating to Zyprexa and found the patent to be valid.
Reacting to the developments, Dr Reddy's Laboratories Vice-Chairman and Chief Executive Officer, Mr G.V. Prasad, said, "We are disappointed by the court decision and will appeal this decision to the Federal Circuit. Despite today's adverse ruling, our strategy remains unchanged and we continue to make consistent progress towards building a sustainable generics business in the US." The case is now headed to the US Court of Appeals for the Federal Circuit located in Washington that specialises in the US patent law, a company press release said.
Responding to the abbreviated new drug application (ANDA) filed by Dr Reddy's before the USFDA, Eli Lilly had filed a suit in May 2001 alleging patent infringement on the `382 compound patent' listed on the Orange Book. The trial was completed in April 2004 and the judgment was long pending. Dr Reddy's was among the three generic drug makers who contested the patent on Zyprexa. The other two were Ivax Corporation and the Israel-based Teva Pharmaceuticals.
Dr Reddy's Labs, and these two companies argued that Olanzapine was covered by a patent that expired in 1995, the year before Zyprexa was first prescribed. The generic drug makers also asserted that Eli Lilly was only able to extend its patent monopoly by misleading the patent office with a flawed clinical study on beagles.
Refuting them, Eli Lilly submitted to the court that the patent was properly issued since Olanzapine had unexpected properties, which were not covered by the first patent. Further, the drug major argued that the drug's commercial success and its use by millions of patients was an indication that other companies would have marketed the drug had they known of those characteristics.
The long awaited decision of the US District Court has provided Eli Lilly the patent rights on Zyprexa that runs through April of 2011. Though Eli Lilly recorded a slow growth in Zyprexa sales, the drug had global sales of $4.42 billion during last year, which accounted for about one third of Eli Lilly's total business.
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