Drug manufacturer AstraZeneca has lost a legal battle in the United States after a court ruling that found its patent for a childhood asthma treatment invalid, allowing the production and distribution of generic products from rival Actavis to be sold on the U.S. market, the company revealed on Tuesday.
The Anglo-Swedish pharmaceutical group announced that the United States District Court for the District of New Jersey had invalidated its patent protecting Pulmicort Respules in the country, and at the same time found that the generic drugs do not infringe AstraZeneca's second patent. Israeli company Teva is already manufacturing a generic version of the drug, but this is under a license from AstraZeneca.
Meanwhile, Actavis said that it was ready to launch its own generic version immediately, offering 0.25- and 0.5-milligram units on the market. Another generic version from Canadian manufacturer Apotex Inc. was approved in the U.S., but the drugmaker has been banned from selling it, following an injunction that AstraZeneca won.
AstraZeneca strongly disagrees with the court's decision and, because of its firm conviction that it possessed the full intellectual property rights protecting its product, the company is considering its next move, including appealing the court's ruling, stated Paul Hudson, executive vice president, North America.
According to the statement released by the company, the decision only affects the patent protecting Pulmicort Respules in the United States and cannot be extended in any way to other countries. The patents protecting the drug expire in 2018 but pediatric exclusivity has been extended for another year. AstraZeneca also said that the ruling would not alter its revenue guidance for 2013, anticipating a single-digit decline in revenue on a constant currency basis. However, if additional generic drugs are to be launched on the market, this would have a serious impact on royalties received on sales of Teva's generic version of Pulmicort Respules, the company stated. AstraZeneca's annual report and accounts state that these royalties were approximately $260 million last year.
The patent ruling is just the latest challenge for AstraZeneca, which recently revealed that it was launching a $2.3 billion plan to restructure the company and cut staff by 10 percent over the next three years. With his arrival last year the new head of the group, Pascal Soriot, pledged to increase AstraZeneca's sales and to shift its focus toward manufacturing innovative prescription drugs. Over the next few years the pharmaceutical group will face tougher competition, as it is going to lose a number of exclusivity patents due to expiry. Some of its key products, including cholesterol treatment Crestor, which generated sales of $6.3 billion last year, are due to lose exclusivity protection in 2016.