Mylan Inc. sued the U.S. Food and Drug Administration, seeking to block India’s Ranbaxy Laboratories Ltd. (RBXY)’s exclusive rights to sell a generic version of Pfizer Inc. (PFE)’s cholesterol pill Lipitor, the world’s best- selling medicine.
Mylan and other generic-drug makers should be allowed to to enter the market as soon as Lipitor’s patent expires in June because of manufacturing violations at two Ranbaxy factories in India, Mylan said in a complaint filed March 18 in federal court in Washington. Ranbaxy, 64 percent owned by Tokyo-based Daiichi Sankyo Co., fell the most in almost two years in Mumbai.
Ranbaxy has said it is entitled to 180 days of marketing exclusivity as a reward for being the first to challenge the Lipitor patents. The drugmaker, based in Gurgaon near New Delhi, reached an agreement with Pfizer in 2008 to sell copies of the medicine beginning Nov. 30. The FDA has yet to clear any of the generic competitors as equivalent to brand-name Lipitor.
“It’s the first time someone is openly challenging Ranbaxy’s exclusivity for Lipitor,” said Bino Pathiparampil, a Mumbai-based analyst at India Infoline Ltd. “It is incrementally negative for sure” for Ranbaxy.
Ranbaxy fell 7 percent, the sharpest decline since May 26, 2009, to 436.05 rupees at the 3:30 p.m. close in Mumbai. That made it the worst performer of the day on the Bombay Stock Exchange 200 Index.
Ranbaxy declined to comment on the lawsuit in an e-mail statement.
What’s At Stake
The six-month period of exclusivity may add as much as $585 million to Ranbaxy’s sales, according to the median of four analysts’ estimates taken before today’s lawsuit. That would make the generic version the biggest product in the Indian drugmaker’s history. Ranbaxy had sales of 85.5 billion rupees ($1.9 billion) last year.
In its complaint, Mylan contends that Ranbaxy isn’t eligible for that marketing exclusivity because of “false and unreliable data” from its manufacturing site in Paonta Sahib, India, used in Ranbaxy’s application for generic Lipitor.
Mylan said it wrote to the FDA in January and February, and met with agency officials on Feb. 14 to ask whether Ranbaxy’s claim to the marketing exclusivity or the entire application would be denied because of the improper information. The FDA hasn’t answered those questions, the company said.
“FDA’s indecision is depriving millions of Lipitor patients access to lower-cost generic Lipitor,” Mylan, based in Canonsburg, Pennsylvania, said in its complaint. It’s “costing the public billions of dollars in savings, and costing generic manufacturers billions of dollars in lost sales.”
‘Tainted by Misconduct’
Mylan wants a court to force the FDA to say publicly whether Ranbaxy’s application “is tainted by Ranbaxy’s misconduct” and that therefore the application must be denied and the 180-day reward voided. A victory for Mylan would let it enter the market in June, when some of the Lipitor patents expire.
Ranbaxy is working with regulators to resolve outstanding questions and is confident that it will get the FDA approval for its copy this year, Chuck Caprariello, a company spokesman, said in an interview last month. The company is working to move manufacturing of generic Lipitor to New Jersey, he said.
Lipitor sales fell 6 percent to $10.7 billion last year as generic competitors arrived in Spain and Canada. New York-based Pfizer’s product has been the world’s biggest-selling medicine for the past 10 years.
The case is Mylan Pharmaceuticals Inc. v. U.S. Food and Drug Administration, 11-566, U.S. District Court for the District of Columbia (Washington).