AstraZeneca Plc (AZN), the U.K.’s second- biggest drugmaker, agreed to settle a lawsuit against generic manufacturer Actavis Inc. (ACT) that alleged violation of the patent on the company’s best-selling Crestor cholesterol treatment.
The agreement allows Actavis and partner Egis Pharmaceuticals to begin selling a copy of Crestor on May 2, 2016, London-based AstraZeneca said in a statement today. Actavis will pay AstraZeneca a fee of 39 percent of net sales until the end of pediatric exclusivity on July 8, 2016. Crestor had sales of $6.25 billion last year.
AstraZeneca in December won an appeals-court ruling blocking generic versions of the drug in the U.S. until July 2016. Shionogi & Co. is also part of the settlement agreement, the terms of which were not disclosed.
“Clearly it removes uncertainty for Astra though we don’t see how much they paid to obtain this settlement, so it is difficult to assess the economic value,” Fabian Wenner, an analyst with Kepler Capital Markets SA who rates the share hold, said in an e-mail. “Strategically, this helps Astra to focus on restructuring and set the organization at ease.”
AstraZeneca rose 0.6 percent to 3,256 pence at 8:17 a.m. in London, giving the company a market value of 40.6 billion pounds ($61.8 billion).
The generic product still must be approved by the U.S. Food and Drug Administration and Actavis has made no decision regarding its release, the company said in a statement.
“This agreement ensures that consumers will benefit from an earlier launch of a rosuvastatin calcium product and eliminates ongoing litigation and uncertainty of marketplace acceptance of a non-generically substitutable product if Actavis had proceeded to launch the alternate product,” Paul Bisaro, president and chief executive officer of Actavis, said in the statement.
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