Teva, Sun Pharma to pay Pfizer $2.15 bn to settle patent suit
12 Jun 2013
US pharmaceutical giant Pfizer Inc today said that Teva Pharmaceuticals Industries Limited and Sun Pharmaceutical Industries Limited have agreed to a $2.15 billion settlement over a patent infringement lawsuit related to its acid-reflux drug Protonix.
The settlement ends a nearly 10-year legal battle in which Pfizer and Nycomed (now part of Japan's Takeda Pharmaceutical Co Ltd) sought to enforce the patent for the blockbuster acid reflux medicine Protonix.
Teva and Sun will pay a total of $2.15 billion to compensate Pfizer's subsidiary Wyeth and Takeda for the damages they suffered when Teva and Sun launched a generic version of Protonix prior to the January 2011 expiry of the patent for pantoprazole, the active ingredient in Protonix.
Pfizer and Takeda will divide the proceeds of the settlement with Pfizer receiving $1.376 billion or 64 per cent of the settlement amount and Takeda, Pfizer's partner on the drug, receiving about $774 million or 36 per cent of the amount.
Israel-based Teva, the world's largest generic drug firm, will pay $1.6 billion of the settlement amount while India-based Sun Pharmaceuticals will pay the remaining $550 million. Teva will pay $800 million in 2013 and the remaining $800 million by October 2014.
Sun will make the entire payment in 2013.
Pfizer won a protracted legal battle in April 2010 when a New Jersey jury ruled that Teva had infringed the Protonix patent. The parties reached the settlement shortly after the commencement of a trial to determine damages in the New Jersey federal court.
Pfizer said both Teva and Sun have admitted that their sales of generic pantoprazole infringed the patent that was held valid by the court.
Teva had, in February, said that it might face legal losses of up to $2.07 billion to resolve the case. Teva started selling a generic version of the drug in 2007.
Sun Pharma had set aside around $100 million last November towards potential damages to Pfizer, will now have to find $450 million more to settle the case.