Patent disputes are common in the pharmaceutical industry, but Eli Lilly & Co. faces an unusual one this week that could be pivotal to the drug maker's future. The case highlights the pressure on drug makers to preserve market exclusivity for top-selling products for as long as possible in the face of generic competition, pricing pressure and underproductive research labs.
At a closely watched trial scheduled to begin Monday in federal court in its hometown of Indianapolis, Lilly will defend a patent for its lung-cancer treatment Alimta, which generated $2.6 billion in global sales last year, or 11% of total company revenue. The patent covers the method of administering Alimta to patients with certain vitamins designed to mitigate side effects. A different patent covers the basic chemical composition of Alimta, a drug that also treats mesothelioma, a rare cancer linked to asbestos exposure.
A Lilly victory would block several generic-drug makers from selling low-cost copies of Alimta in the U.S. market until at least 2022, when the vitamin-regimen patent exclusivity period is due to expire. A loss, however, could clear the way for generics to enter the market in 2017, when patent exclusivity expires for the basic compound. That would sharply erode sales of the original brand.
Lilly is under pressure to preserve Alimta's blockbuster sales because patents for other drugs have reached or are approaching their natural expiration dates. The company lost patent protection for its former top product, the antipsychotic Zyprexa, in 2011. This year Lilly will lose patent protection for its new No. 1 drug, antidepressant Cymbalta.
Meanwhile, Lilly hasn't produced enough newer products to replace revenue lost to competition from generic versions of older drugs.
"Strategically, it would be a big win for them because they're facing a lot of other patent losses," said Damien Conover, analyst with Morningstar.
Other drug makers, including Pfizer Inc. and Merck & Co., are going through similar challenges, having lost patent protection for big drugs and are facing a gap before revenue from newer drugs can make up the difference. Such pressures can make it more worthwhile to try to defend secondary patents for drugs, as Lilly is doing with Alimta.
Generic-drug companies such as Teva Pharmaceutical Industries Ltd. frequently challenge the validity of patents for brand-name drugs in bids to start selling knockoffs before the patents expire.
Makers of brand-name drugs generally have been successful defending primary patents that claim invention of the basic chemical compositions of their drugs' active ingredients.
But it can be tougher and costly to defend secondary patents for the same drug—those covering new formulations or methods to treat certain diseases, which often have later expiration dates than the primary compound patent. Generic-drug companies have had more success arguing that such follow-on patents should be struck down because their claims were anticipated by prior, publicly available research.
Still, the challenge hasn't stopped makers of brand-name drugs from seeking and defending secondary patents. In 2011 Pfizer won a federal-court ruling upholding a patent covering the method of using the active ingredient of Viagra to treat erectile dysfunction, extending its market exclusivity by seven years, to 2020, beyond the basic-compound patent exclusivity. Pfizer successfully argued that Viagra's anti-impotence properties weren't immediately obvious, and only became known during testing of the drug as a potential treatment for certain heart-related conditions.
The Lilly patent at issue this week covers the method of administering Alimta with folic acid and vitamin B12, which have been shown to reduce the incidence of side effects of Alimta, such as low counts of white blood cells. The vitamins themselves aren't patented. The drug's prescribing label, approved by the U.S. Food and Drug Administration, instructs doctors to start providing the supplements about one week before the first dose of Alimta, and to continue them during treatment.
Several generic-drug makers, including Teva and Fresenius Kabi SE & Co.'s APP Pharmaceuticals unit, want to sell generic versions of Alimta before the vitamin-dosage-regimen patent expires. The generic-drug companies argued in court papers that the patent was invalid because previous research would have led a person of ordinary skill in oncology or nutrition to conclude that Alimta should be given with folic acid and B12. Under patent law, a court can deem a patent invalid if its claims are "obvious" and anticipated by previous research.
Lilly filed a patent-infringement lawsuit against the companies in 2010, shortly after the vitamin-dosage-regimen patent was issued. The suit seeks a judgment that the generic companies have infringed the patent, and that they be barred from selling copies of Alimta until the patent expires.
Lilly has said that the claimed invention wasn't obvious. In clinical testing in the late 1990s before the drug was approved, researchers observed "a string of drug-related deaths that had put the future" of Alimta in jeopardy, Lilly said in court papers.
A Lilly scientist proposed administering folic acid with B12 to mitigate the safety risk, an idea that initially "met stiff resistance both within and outside Lilly," including at the FDA, because of concerns that it would diminish efficacy. However, researchers eventually tried the regimen in clinical testing, which showed that Alimta's efficacy was maintained while the most severe and life-threatening side effects were reduced.
Lilly said that the method was an unexpected finding that essentially saved Alimta's development.
"We believe this patent is valid and enforceable and we are prepared to defend our intellectual property," a Lilly spokesman said. "The significant scientific research that Lilly performed in support of the vitamin-dosage-regimen patent deserves intellectual-property protection."
Spokesmen for Teva and Fresenius Kabi declined to comment.
—The Week Ahead looks at coming corporate events.
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