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Eli Lilly may keep patent, judge rules
A federal judge rejects challenges to Lilly's hold on antipsychotic drug Zyprexa. One generic manufacturer plans an appeal.
Associated Press
Published April 16, 2005
INDIANAPOLIS - Shares of Eli Lilly & Co. soared more than 5 percent Friday after a federal judge ruled valid a U.S. patent on its bestselling drug, Zyprexa, rejecting the claims of generic drug manufacturers.
U.S. District Judge Richard Young said in a 212-page ruling Thursday that Lilly's rivals failed to prove that the patent on the antipsychotic drug should be struck down.
One of the generic manufacturers plans an appeal and others are likely, given the financial stakes surrounding Zyprexa: U.S. sales of the treatment for schizophrenia and other disorders brought in $2.4-billion for Lilly last year. The drug had worldwide sales of $4.4-billion in 2004.
The ruling, which came more than 14 months after a bench trial in the case, is a huge relief to Lilly, chairman and chief executive Sidney Taurel said.
"There is no question that from the investment community standpoint, this was a distraction, this was a cloud that was hovering over the company," Taurel said.
Eli Lilly shares rose $2.91, or 5.3 percent, to close at $58.07 in Friday trading on the New York Stock Exchange. The stock has been trading at a 52-week range of $50.34 to $76.95.
Many Wall Street analysts had expected Lilly to prevail in the ruling, which was issued after the close of trading Thursday on the New York Stock Exchange.
The generic manufacturers - Zenith Goldline Pharmaceuticals, owned by IVAX Corp. of Miami; Dr. Reddy's Laboratories of India; and the U.S. arm of Israeli-based Teva Pharmaceutical Industries - had challenged a 1993 patent that granted Lilly U.S. rights to Zyprexa until 2011.
The Lilly rivals argued during a three-week trial that the patent no longer was valid because discovery of the drug's molecular structure was obvious and that a previous Lilly patent had covered it. The companies also claimed Lilly misled the patent office and omitted certain test results when applying for the patent.
IVAX said it would appeal the decision.
[Last modified April 16, 2005, 01:24:50]
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