The Telegraph
Since 1st March, 1999
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DRL stuns Pfizer in patent bout

Mumbai, Dec. 18: Dr Reddy’s Laboratories (DRL) has won a patent dispute in a US court against Pfizer Inc that will enable it to sell a modified version of Norvasc, the multinational’s blockbuster hypertension drug, in that country.

The ruling marks a major victory not only for DRL, but the entire Indian pharmaceutical industry, as the clearance is the first success of its kind attained by a domestic research oriented company in speciality products. Unlike a generic version of a drug, a speciality drug is an innovation over an existing product, which could lead to a product exclusivity of up to three years.

DRL said that the US district court in New Jersey dismissed Pfizer’s complaint on December 17, on the grounds that the patent term extension does not cover Dr Reddy’s amlodipine maleate product. Amlodipine maleate differs chemically from the amlodipine besylate form of Pfizer’s anti-angina and hypertension blockbuster, which recorded sales of $ 2.5 billion in 2001.

DRL expects to launch the product in August, upon expiration of Pfizer’s paediatric exclusivity and receipt of a final US Food and Drug Administration (FDA) approval for the company’s new drug application (NDA). Pediatric exclusivity is a six-month marketing exclusivity given to the innovator of a drug if it establishes that the drug is safe for children.

The announcement drove up Dr Reddy’s shares on the stock exchange today. The scrip, which has been under pressure in recent times, spurted by over 7 per cent to finish at Rs 875.95 on the Bombay Stock Exchange today.

Speaking to The Telegraph, chief executive officer G. V. Prasad said that the court ruling would be a significant milestone for launching its speciality products in the US. He added the company now plans to build a pipeline of similar products.

Asked how DRL would proceed with distributing the product, Prasad the company was evaluating three options, including building an alliance with an established pharmaceutical company, building up a sales force and third, acquisition.

“Our key priority is to create an exciting and sustainable pipeline of speciality products and the commercial front end to take these products to the market. The speciality business will be a vital link in our transition from an emerging global pharmaceutical player to a discovery-led global pharmaceutical company,” he added.

Sources close to DRL said the amlodipine maleate success could hold a significant opportunity for the company over the long term as it could capitalise on its brand equity. “DRL can build a brand equity and use this as a platform for new chemical entities where prospects are even higher.”

Conservative estimates say DRL’s topline is projected to grow by at least Rs 250 crore while a few analysts see an upside of Rs 500 crore from the drug.

“Even on a conservative basis, if the company is able to corner a 20 per cent market share with a 50 per cent price reduction, it should able to post revenues of around Rs 250 crore and profits of around Rs 125 crore, presuming it is able to retain around 60 per cent of the sale proceeds,” C Srihari, pharmaceutical analyst at Khandwala Securities said.

However, some preferred to exercise caution. An analyst averred that though amlodipine could easily pip DRL’s generic version of Eli Lilly’s antidepressant Prozac (it sold more than $ 100 million), there could be delays if Pfizer chose to appeal.

DRL had filed an NDA for amlodipine maleate under Section 505(b)(2) of the Federal Food, Drug and Cosmetic Act in December 2001. On June 17, Pfizer notified Dr Reddy’s that it had filed a suit in the Federal Court in New Jersey on one of the two patents. Subsequently, Dr Reddy’s filed a motion to dismiss Pfizer’s complaint, a ruling on which was given on December 17.

In October, the USFDA had issued an “approvable letter”—often a precursor for full approval—for the drug. Final approval is contingent upon the successful completion of ongoing discussions with the FDA regarding issues relating to specific chemistry manufacturing controls and product labelling.

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