Otsuka Can Block Generic Abilify as Court Rejects Appeal

The U.S. Supreme Court left intact a ruling that lets Otsuka Holdings Co. (4578)’s pharmaceutical unit block generic competition to its schizophrenia drug Abilify in the U.S. until April 2015.

The justices today turned away an appeal by Canadian generic-drug maker Apotex Corp. The company challenged the patent for Abilify’s active ingredient, contending it would have been obvious to scientists based on known research. A U.S. appeals court rejected that argument.

The drug generates sales of more than $5 billion a year, making it the fourth largest-selling drug in the U.S., Otsuka said, citing data from researcher IMS Health. New York-based Bristol-Myers Squibb Co. (BMY), which markets the drug with Otsuka, reported its share of Abilify sales was $2 billion in the first nine months of last year, or 15 percent of its revenue.

Apotex said the active ingredient aripiprazole belongs to a class of compounds that have been known since the early 1980s and were covered by a patent that expired in 2005.

The legal standard for deciding that question is too broad and “permits pharmaceutical companies to obtain or maintain patent monopoly rights over large portions of what belongs in the public domain,” Apotex argued in its high court appeal.

Tokyo-based Otsuka said the U.S. Court of Appeals for the Federal Circuit, which heard the case, doesn’t use such a standard.

“Apotex simply failed to prove that a person of ordinary skill” would have revised known ingredients “to arrive at the claimed compound aripiprazole with predictable results,” Otsuka said.

The case is Apotex Inc. v. Otsuka Pharmaceutical Co., 12-571, U.S. Supreme Court.

The appeals court case is Otsuka Pharma Co. v. Sandoz Inc., 2011-1126 and 2011-1127, U.S. Court of Appeals for the Federal Circuit (Washington). The trial court case is Otsuka Pharmaceutical Co. v. Sandoz Inc., 07cv1000, U.S. District Court for the District of New Jersey (Trenton).

To contact the reporters on this story: Susan Decker in Washington at sdecker1@bloomberg.net; Greg Stohr in Washington at gstohr@bloomberg.net

To contact the editors responsible for this story: Bernard Kohn at bkohn2@bloomberg.net; Steven Komarow at skomarow1@bloomberg.net