Biotech Values

[DewDiligence]

Crestor Patent Trial Ends—Ruling Due in a Few Months

http://www.reuters.com/article/idUSLDE6231TP20100304

›AstraZeneca upbeat on Crestor patent as trial ends

11:24am EST

* U.S. trial ends two days early, judgment due by July

* Analysts see odds in Astra's favour but case is tight

* Loss of patent would deprive Astra of top sales driver

By Ben Hirschler

LONDON, March 4 (Reuters) - AstraZeneca <AZN.L> said on Thursday it was confident of retaining exclusivity on its top-selling cholesterol drug Crestor, after a U.S. trial testing the patent wrapped up two days early.

The case hinges on the intentions of three Japanese staff at Shionogi <4507.T> who worked on patent applications almost two decades ago, before the medicine was licensed to AstraZeneca.

A group of generic challengers argued in the trial, which ended on Wednesday, that the patent was fraudulently obtained, improperly reissued and protected an obvious invention.

But AstraZeneca said it believed the evidence showed no one at Shionogi deliberately concealed information from the U.S. patent office.

"The defendants, in our view, failed to prove their claims. We have, and will continue to, aggressively defend our patent," the drugmaker said in an emailed statement.

Lawyers for the generics companies also put a confident face on the proceedings.

"We are very pleased with the way the evidence went in, particularly the expert testimony on obviousness and the lack of secondary considerations," said Tom Heneghan, an attorney with Merchant & Gould, representing Aurobindo Pharma <ARBN.BO>.

Most industry analysts think AstraZeneca probably has the edge -- but the case is tight and the verdict will depend in part on the degree of intent that the judge decides needs to be shown to prove unfair conduct.

"On balance we believe that AstraZeneca is more likely to prevail than not," Royal Bank of Scotland analysts said in a note on Thursday.

The judge in the Delaware trial, Joseph Farnan, is due to give his verdict before he retires in July.

AstraZeneca's sales of Crestor are forecast to rise to $6.5 billion in 2013 from $4.5 billion in 2009, according to consensus estimates from Thomson Reuters, making it the company's most important sales driver.

But those numbers would be blown out of the water if generics were to enter the all-important U.S. market in mid-2010, instead of after the patent's scheduled 2016 expiry.

The arrival of generic Crestor would also be damaging indirectly to other drugmakers like Pfizer <PFE.N> and Merck & Co <MRK.N>, which have other branded cholesterol medicines whose sales could suffer.

Crestor's generic challengers include Apotex, Aurobindo, Mylan <MYL.O>, Par Pharmaceuticals <PRX.N>, Novartis's <NOVN.VX> Sandoz, Sun Pharmaceutical Industries <SUN.BO>, Teva Pharmaceutical Industries <TEVA.TA> and Watson Pharmaceuticals' <WPI.N> Cobalt.‹