Sun Pharma sinks on adverse US rulings

Shares of Sun Pharma took a big knock after a US district court ruled that the Indian drugmaker will have to withdraw its generic Eloxatin product from the American market on June 30th. Sun Pharma said it will re-enter the US market by 2012. Eloxatin is an anticancer drug with US$1.4bn annual sales in US at innovator prices, IIFL said in a note. Sun Pharma had launched it in March 2010, after a favorable judgment from a court of law regarding the enforceability of its settlement with Sanofi, the innovator. Later, other generic players settled with Sanofi and agreed to withdraw the product from the market on June 30. Sun Pharma can appeal the decision by the district court in a court of appeal, IIFL said. However, even if the appeal court gives a temporary reprieve to Sun Pharma, the sales would practically be at risk of damages, should it lose the appeal, it added.
Separately, Sun Pharma said that a jury returned a verdict in the patent litigation over generic Protonix. The trial is currently underway in the US District Court for the District of New Jersey. The jury determined that Nycomed's US Patent No. 4,758,579 is not invalid. The Court has reserved decision on the issue of the effect to be given to the jury's determinations relating to the obviousness-type double patenting defenses, which as the company has argued, is to be decided by the Court, Sun Pharma said. Pantoprazole Sodium DR Tablets are the AB-rated generic equivalent of Wyeth's Protonix DR Tablets. Protonix is an anti-gastric ulcer drug that had US$2.3bn annual sales at innovator prices.
Only one argument for invalidity (obviousness) had been posted to the jury for examination and the second argument (obviousness type double patenting) is still with the judge to decide upon. "We feel that the risk of adverse ruling is significantly higher than before," IIFL said in a note. Israel's Teva Pharma, followed by Sun Pharma launched generic versions at risk of IP violation in Q1 CY08, according to IIFL. Wyeth had launched an authorized generic as well. Later on, Kudco too entered the market, in March 2009.