Pfizer and Ranbaxy settle global Lipitor patent litigation

18 June 2008

Ahead of Daiichi Sanko's mandatory open offer for 20-per cent shares that opens on 8 August, Ranbaxy and Pfizer today said in seperate announcements that that they had entered into an agreement to settle substantially all their patent litigation worldwide involving Atorvastatin (Lipitor), the world's largest selling drug with worldwide sales in 2007 of $12.7 billion. 

The agreement between the two pharmaceutical leaders, the biggest and most comprehensive settlement of global pharmaceutical marketing rights,  also resolves the litigation over Caduet (which also contains crystalline form I Atorvastatin) and Accupril in the US and will allow for an earlier introduction of a generic formulation that will benefit patients and many healthcare systems throughout the world.

The agreement pertains solely to Ranbaxy and its affiliates and does not cover legal challenges to the Lipitor patents involving other generic manufacturers. 

The settlement provides Ranbaxy with licenses to all the patents it needs to make the generic product and enables Ranbaxy to manufacture and launch a generic version of Lipitor prior to the expiration of the crystalline and amorphous patents. Howevern under the terms of the agreement, Ranbaxy will will delay marketing the generic versions of Atorvastatin and the fixed-dose combination of Atorvastatin-Amlodipine besylate (Caduet) in the United States till 30 November 2011, instead of launching it between March 2010 and June 2011.

According to the agreement, there will be no upfront payments from Pfizer and all revenues will be only through sales. Ranbaxy will get early mover advantage on Lipitor in other countries of two to four months. It will also get an authorised generic status on Caduet from Pfizer for Canada. All the launches post patent settlement will be absolutely risk-free. All back-end patents running upto 2016 for Lipitor have been settled.

As Ranbaxy was the first generic challenger to the listed Lipitor patents, it retains the right to the marketing exclusivity of 180 days from 30 November 2011 in the United States, along with exclusivity in Canada two months before Lipitor patent expiry and exclusivity in Australia 105 days before Lipitor patent expiry.