March 21 (Bloomberg) -- Sanofi-Aventis SA and Bristol-Myers Squibb Co. settled a patent lawsuit against Apotex Inc., keeping a generic version of the blood thinner Plavix, the world's second-biggest drug, off the market until 2011.

The drugmakers said in a statement that Apotex Inc. agreed not to sell a generic version of the drug until September 2011. In exchange, the companies will pay an unspecified amount to Apotex. The lawsuit settlement sent Bristol-Myers shares up 8.6 percent and Sanofi's American depositary receipts up 7 percent.

Plavix lags behind Pfizer Inc.'s cholesterol treatment Lipitor in global drug sales, generating $6.2 billion a year as a treatment for patients in the midst of a heart attack or undergoing artery-clearing procedures. Sanofi and Bristol-Myers, which jointly developed Plavix, are seeking to squeeze more growth from the product as they develop new drugs.

``There's a lot to be said for certainty,'' said patent lawyer John Singer of Fish & Richardson in Minneapolis, who specializes in drug cases. From Apotex's ``perspective, they will be able to launch without some patent coming out from out of the blue.''

Bristol-Myers shares rose $2.02 to $24.85 in extended trading after closing at $22.83 in New York Stock Exchange composite trading. Sanofi's American depositary receipts, two of which represent one ordinary share, rose $3.07 to $46.75. They closed at $43.68 in regular trading.

Royalty Payment

Sanofi and Bristol-Myers will pay Apotex an unspecified amount to Apotex before the license takes effect in 2011. Apotex will pay a royalty after it begins sales of the drug, said Bristol-Myers spokeswoman Laura Hortas.

Officials with Weston, Ontario-based Apotex didn't return voice mail messages seeking comment.

Sanofi and Bristol-Myers sued Apotex in 2002 in New York. The settlement must receive antitrust approval from state attorneys general and the U.S. Federal Trade Commission. The companies said there is a ``significant risk'' that either the states or the FTC will reject the agreement.

The agreement was reached ``based on the balance between the risk of outcome in the litigation and the certainty of a settlement,'' Sanofi said in a statement on its Web site.

If the agreement is rejected, Apotex may be able to begin sales even before the patent expires because it received final approval in January from the U.S. Food and Drug Administration to sell a generic Plavix.

A trial on the case was scheduled to begin in June in New York. That case has been put on hold pending finalization of the settlement, Sanofi and Bristol-Myers said in the statement.

Under the terms of the agreement, Apotex can sell its version at least eight months before the expiration of a patent on clopidogrel bisulfate, the main compound for the drug.

Split Payments

Sanofi and Bristol-Myers said in a statement that they'd split the payments to closely held Apotex evenly. Apotex could sell earlier if another generic drug enters the market.

The companies also are challenging a bid by Dr. Reddy's Laboratories Ltd. to sell a low-cost version of the drug. Paris- based Sanofi and New York-based Bristol-Myers said they have ``approached Dr. Reddy's to discuss a possible settlement of this matter.''

Teva Pharmaceutical Industries Ltd., the world's biggest generic-drug maker, is among those seeking to sell generic Plavix. Bristol-Myers' Hortas said the companies are ``going to reach out to them, but we have not done so yet.''

The dispute with Apotex is over a patent for the main compound on the drug. Other brand-drug makers, including Pfizer Inc. and Eli Lilly & Co., have been successful in protecting their compound patents, leading investors to predict that Bristol-Myers and Sanofi would be successful at trial.

$3.8 Billion

Plavix, which Bristol-Myers Squibb and Sanofi developed and market together, is Bristol-Myers's biggest-selling product, having risen to $3.8 billion in 2005 from $3.3 billion the year before.

Bristol-Myers said in a regulatory filing March 14 that the outcome of the Plavix patent litigation would be a major ``competitive factor'' affecting its sales. Generic competition for Plavix would probably result in ``substantial decreases in sales'' in the U.S., the company said in the filing.

The case is Sanofi-Synthelabo v. Apotex, 02cv2255, U.S. District Court for the Southern District of New York.

To contact the reporter on this story: Susan Decker in Washington at sdecker1@bloomberg.net.

Last Updated: March 21, 2006 20:36 EST